The June Short-Term Energy Outlook ( STEO ) remains subject to heightened levels of uncertainty related to the ongoing economic recovery from the COVID-19 pandemic . The U . S . economy continues to rise after reaching multiyear lows in the second quarter of 2020 ( 2Q20 ). The increase in economic activity and easing of the COVID-19 pandemic have contributed to rising energy use . U . S . gross domestic product ( GDP ) declined by 3.5 % in 2020 from 2019 levels . This STEO assumes U . S . GDP will grow by 6.7 % in 2021 and by 4.9 % in 2022 . The U . S . macroeconomic assumptions in this outlook are based on forecasts by IHS Markit . Our forecast assumes continuing economic growth and increasing mobility as a result of the easing of the COVID-19 pandemic . Any developments that would cause deviations from these assumptions would likely cause energy consumption and prices to deviate from our forecast .

Brent crude oil spot prices averaged $ 68 per barrel ( b ) in May , up $ 4 / b from April . Brent prices were higher in May as global oil inventories continued to decline , albeit at a slower pace than in the first four months of the year . In the coming months , we expect that global oil production will increase to match rising levels of global oil consumption . The rising oil production in the forecast is largely a result of the OPEC + decision to raise production . We expect rising production will end the persistent global oil inventory draws that have occurred for much of the past year and lead to relatively balanced global oil markets in the second half of 2021 ( 2H21 ). We expect Brent prices will remain near current levels in 3Q21 , averaging $ 68 / b . However , in 2022 , we expect that continuing growth in production from OPEC + and accelerating growth in U . S . tight oil production — along with other supply growth — will outpace decelerating growth in global oil consumption and contribute to declining oil prices . Based on these factors , we expect Brent to average $ 60 / b in 2022 .

We expect U . S . gasoline consumption will average 9.1 million barrels per day ( b / d ) this summer ( April – September ), which is 1.3 million b / d more than last summer but still more than 0.4 million b / d less than summer 2019 . Weekly consumption data reflect the Colonial Pipeline outage and subsequent increase in gasoline demand , but consumption both before and after this event indicate more gasoline demand than we had previously forecast . Our latest forecast also reflects IHS Markit ’ s increased employment forecast . We expect U . S . gasoline consumption to average 8.7 million b / d in for all of 2021 and 9.0 million b / d in 2022 .

For the 2021 April – September summer driving season , we forecast U . S . regular gasoline retail prices will average $ 2.92 per gallon ( gal ), up from an average of $ 2.07 / gal last summer . The higher forecast gasoline prices reflect higher crude oil prices and higher wholesale gasoline margins . Wholesale gasoline margins have risen as a result of relatively low inventories and rising gasoline demand . Margins also temporarily widened because of outages on the Colonial Pipeline . These developments caused U . S . average regular gasoline retail prices to reach a monthly average of $ 2.99 / gal in May , peaking at $ 3.03 / gal on

May 17 , which were the highest monthly and weekly prices since 2014 . We expect that prices will average $ 3.03 / gal in June before falling to $ 2.76 / gal by September . The drop in forecast retail gasoline prices reflects our forecast that gasoline margins will fall this summer in response to rising refinery utilization . For all of 2021 , we expect U . S . regular gasoline retail prices to average $ 2.77 / gal and gasoline retail prices for all grades to average $ 2.87 / gal . Higher prices and more gasoline consumption would result in the average U . S . household spending about $ 570 ( 38 %) more on motor fuel in 2021 compared with 2020 .

We estimate that 96.2 million b / d of petroleum and liquid fuels was consumed globally in May , an increase of 11.9 million b / d from May 2020 but 3.7 million b / d less than in May 2019 . We forecast that global consumption of petroleum and liquid fuels will average 97.7 million b / d for all of 2021 , which is a 5.4 million b / d increase from 2020 . We forecast that global consumption of petroleum and liquid fuels will increase by 3.6 million b / d in 2022 to average 101.3 million b / d .

We forecast OPEC crude oil production will average 26.9 million b / d in 2021 and 28.7 million b / d in 2022 . OPEC crude oil production in the forecast rises from 25.0 million b / d in April to an average of 28.0 million b / d in 3Q21 . Our expectation of rising OPEC production is primarily based on our assumption that OPEC will raise production by about 1 million b / d in

10 JULY / AUGUST 2021 | FUEL OIL NEWS | www . fueloilnews . com