� SHORT-TERM ENERGY OUTLOOK
Forecast Highlights
Brent crude oil spot prices averaged $ 71 per barrel ( b ) in April , up $ 5 / b from March 2019 and just below the price in April of last year . EIA forecasts Brent spot prices will average $ 70 / b in 2019 and $ 67 / b in 2020 , both about $ 5 / b higher than in last month ’ s STEO , compared with an average of $ 71 / b in 2018 . EIA ’ s higher Brent crude oil price forecast reflects tighter expected global oil market balances in mid- 2019 and increasing supply disruption risks globally .
EIA forecasts that crude oil production in the Organization of the Petroleum Exporting Countries ( OPEC ) will average 30.3 million barrels per day ( b / d ) in 2019 , down by 1.7 million b / d from 2018 . In 2020 , EIA expects OPEC crude oil production to fall by 0.4 million b / d to an average of 29.8 million b / d . Production in Venezuela and Iran account for most of the OPEC output declines in 2019 and in 2020 , but EIA expects these declines to be partially offset by production increases from other OPEC members .
EIA forecasts global oil inventories will decline by 0.2 million b / d in 2019 and then increase by 0.1 million b / d in 2020 . Global demand outpaces supply in 2019 in EIA ’ s forecast , but global liquid fuels supply then rises by 1.9 million b / d in 2020 , with 1.5 million of that growth coming from the United States . Global oil demand rises by 1.5 million b / d in 2020 in the forecast , up from expected growth of 1.4 million b / d in 2019 .
For the 2019 summer driving season , which runs from April through September , EIA forecasts that U . S . regular gasoline retail prices will average $ 2.92 per gallon ( gal ), up from an average of $ 2.85 / gal last summer . The higher forecast gasoline prices primarily reflect EIA ’ s expectation of higher gasoline refining margins this summer , despite slightly lower crude oil prices .
The Henry Hub natural gas spot price averaged $ 2.64 / million British thermal units ( MMBtu ) in April , down 31 cents / MMBtu from March . Prices fell as a result of warmer-than-normal temperatures across much of the United States , which reduced the use of natural gas for space heating and contributed to above-average inventory injections during the month . EIA expects strong growth in U . S . natural gas production to put downward pressure on prices in 2019 and in 2020 . EIA expects Henry Hub natural gas spot prices will average $ 2.79 / MMBtu in 2019 , down 36 cents / MMBtu from 2018 . The forecasted 2020 average Henry Hub spot price is $ 2.78 / MMBtu .
EIA forecasts that dry natural gas production will average 90.3 billion cubic feet per day ( Bcf / d ) in 2019 , up 6.9 Bcf / d from 2018 . EIA expects natural gas production will continue to grow in 2020 to an average of 92.2 Bcf / d .
EIA estimates that natural gas inventories ended March at 1.2 trillion cubic feet ( Tcf ), 16 % lower than levels from a year earlier and 29 % lower than the five-year ( 2014 – 18 ) average . EIA forecasts that natural gas storage injections will outpace the previous five-year average during the April-through-October injection season and that inventories will reach 3.7 Tcf at the end of October , which would be 15 % higher than October 2018 levels and about equal to the fiveyear average .
West Texas Intermediate ( WTI ) crude oil price and NYMEX confidence intervals dollars per barrel
EIA expects the share of U . S . total utility-scale electricity generation from natural gas-fired power plants to rise from 35 % in 2018 to 37 % in 2019 and to 38 % in 2020 . EIA forecasts that the share of electricity generation from coal will average 24 % in 2019 and 22 % in 2020 , down from 27 % in 2018 . The nuclear share of generation was 19 % in 2018 , and EIA forecasts that it will stay near that level in 2019 and in 2020 . The generation share of hydropower averages 7 % of total generation in EIA ’ s forecast for 2019 and 2020 , similar to 2018 . Wind , solar , and other nonhydropower renewables together provided about 10 % of electricity generation in 2018 . EIA expects they will provide 11 % in 2019 and 13 % in 2020 .
EIA forecasts that all renewable fuels , including wind , solar , and hydropower , will produce 18 % of U . S . electricity in 2019 and almost 20 % in 2020 . EIA expects that wind generation will surpass hydropower generation for the first time to become the leading source of renewable electricity generation in 2019 and maintain that position in 2020 .
EIA estimates that U . S . coal production in the first quarter of 2019 was 170 million short tons ( MMst ), 22 MMst ( 12 %) lower than the previous quarter and 17 MMst ( 9 %) lower than production in the first quarter of 2018 . EIA expects that coal production will fall during the forecast period as demand for coal ( domestic consumption and exports ) declines . EIA forecasts that coal production will total 700 MMst in 2019 and 638 MMst in 2020 ( declining by 7 % and 9 %, respectively ).
After rising by 2.7 % in 2018 , EIA forecasts that U . S . energyrelated carbon dioxide ( CO2 ) emissions will decline by 2.1 % in 2019 and by 0.8 % in 2020 . EIA expects emissions to fall in 2019 and in 2020 as forecast temperatures return to near normal after a warm summer and cold winter in 2018 and because the forecast share of electricity generated from natural gas and renewables increases while the forecast share generated from coal , which produces more CO2 emissions , decreases . Energy-related CO2 emissions are sensitive to weather , economic growth , energy prices , and fuel mix .
� SOYBEAN OIL COMPRISES LARGER SHARE OF DOMESTIC BIODIESEL PRODUCTION
Biodiesel production accounts for an increasing share of soybean oil
10 JUNE 2019 | FUEL OIL NEWS | www . fueloilnews . com