EIA Anticipates 2024 Fuel Prices to Surpass Last-Year Levels
The U.S. Energy Information Administration (EIA) has revised its projections for global fuel prices and consumption, anticipating a surge in fuel prices in 2024, surpassing the levels observed in 2023.
The EIA’s revised forecast reveals an upward trajectory for diesel prices, with the average wholesale price expected to climb to $2.96 per gallon by the fourth quarter of 2024, marking a 1.3% increase from previous estimates. This adjustment comes amidst a broader trend of rising crude oil prices, with West Texas Intermediate (WTI) crude forecasted to average $84 per barrel for the year and Brent crude expected to average $89 per barrel.
EIA attributes the surge in fuel prices to multiple factors, including ongoing production cuts by major oil-producing nations and an anticipated uptick in global diesel demand. These developments are poised to impact industries reliant on diesel, such as transportation, agriculture, and construction, potentially leading to increased operational costs and logistical challenges.
Despite the forecasted rise in diesel prices, the EIA anticipates a slight reduction in U.S. gasoline consumption for 2024, with demand projected to average 8.94 million barrels per day (b/d), down 0.5% from previous estimates. Concurrently, the agency forecasts a modest increase in U.S. crude oil production, setting a new annual record of 13.21 million b/d for 2024.
The latest outlook also includes adjustments to the EIA’s forecasts for global fuel production and consumption, reflecting evolving market dynamics. The agency now anticipates global production to reach 102.65 million b/d, with consumption averaging 102.91 million b/d for the year.
In response to these shifts, the EIA has revised its expectations for oil stocks, with reductions in forecasted closing stocks of oil and gasoline, but an increase in distillate stocks. These adjustments underscore the agency’s commitment to providing accurate and timely insights into energy market trends.
This article is part of Daily Market News & Insights
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