This week was stacked with important headlines including what to expect to pay at the gas station in 2022, freezing temperatures in major cities, prices reaching two-month highs, and surging oil prices predicted for 2023 and beyond. According to the U.S. Energy Information Administration (EIA), expect crude oil prices to hover around the $70 mark for 2022. While they expect the average price of gasoline to drop to around $2.88 in 2022, others such as Bank of America, Wells Fargo, and Goldman Sachs believe that oil will not drop, but push upwards in 2022.
Some areas of the United States are experiencing weather that could cause frostbite in minutes this week, with temperatures and wind chills making 16 degrees feel like twenty below. Although NOAA predicted a warm winter back in October due to the presence of La Nina conditions, more recent forecasts point to a long, frigid winter. Over the past few weeks, we have seen weather patterns bring in new cold fronts, but this week it has picked up enormously, bringing some of the coldest weather we will see all season in major U.S. cities.
This week new information in a report from the EIA shows the possibility of oil production setting a full-year record in 2023. This is important news as the Biden administration is focused primarily on renewable energy and zero-carbon emissions. Even more interesting is the data that we see from the EIA. According to the EIA, the United States could see around 12.4 million barrels per day (bpd) in 2023. This is ahead of the 12.3 million bpd average we saw in 2019, but still slightly off from the peak of 2019, where the country reached 13 million bpd.
Prices in Review
WTI Crude opened the week at $78.88. Prices rose consistently throughout the week before becoming more volatile on Thursday and Friday. Crude opened Friday at $81.73, an increase of $2.85 from Monday.
Diesel opened the week at $2.4917. Diesel was extremely volatile this week, with many changes following similar trends of crude. It opened Friday at $2.6016, an increase of $0.1099 from Monday.
Gasoline opened the week at $2.3039. Prices were volatile early before spiking up later in the week. Today prices are up again with gasoline opening at $2.3756, up $0.0717 from Monday’s opening price.