The home heating oil industry has a long and proud history, and Fuel Oil News has been there supporting it since 1935. It is an industry that has faced many challenges during that time. In its 77th year, Fuel Oil News is doing more than just holding
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Fuels eIA N e w s 12 FEBRUARY 2015 | FUEL OIL NEWS | www.fueloilnews.com NEW HIRE At PGANE PGANE has announced the appointment of Byron Breda as safety, training, and recruitment coordinator for PGANE. Byron is a retired lieutenant from the Nashua Fire Rescue where he was an officer on the hazmat team. In addition he has over 30 years of experience in the fuel oil and propane indus- try serving as the company safety director for the past seven years since his retirement from the Fire Department. Breda is well known in the N.H. regulatory community and the New England fire service. He has served on the PGANE Emergency Response Committee as an active trainer for the past five years. His role is to help with code, regulatory and training issues and he will lead the recruitment program for newly graduated students who want to pursue a career as a propane technician or driver. You can reach Breda at byron@pgane.org or at 888- 445-1075. eIA short-Term energy Outlook, Jan. 13, 2014 Highlights This edition of the Short-Term Energy Outlook is the first to include forecasts for 2016. December was the sixth consecutive month in which monthly average Brent prices decreased, falling $17/barrel from November to a monthly average of $62/bbl, the low- est since May 2009. The December price decline reflects continued growth in U.S. tight oil production, strong glob- al supply, and weakening outlooks for the global economy and oil demand growth. EIA forecasts that Brent crude oil prices will average $58/bbl in 2015 and $75/bbl in 2016, with annual average West Texas Intermediate prices expected to be $3/bbl to $4/ bbl below Brent. The current values of futures and options contracts suggest very high uncertainty in the price outlook (Market Prices and Uncertainty Report). WTI futures con- tracts for April 2015 delivery, traded during the five-day period ending January 8, averaged $51/bbl, establishing the lower and upper limits of the 95% confidence interval for the market's expectations of monthly average WTI prices in April 2015 at $34/bbl and $76/bbl, respectively. The 95% confidence interval for market expectations widens considerably over time, with lower and upper limits of $28 and $112 for prices in December 2015. Total U.S. crude oil production averaged an estimated 9.2 million barrels per day in December. Forecast total crude oil production averages 9.3 million bbl/d in 2015. Under EIA's price forecast, projected crude oil production averages 9.5 million bbl/d in 2016, which would be the second-highest annual average level of production in U.S. history; the highest was 9.6 million bbl/d in 1970. Driven largely by falling crude oil prices, U.S. week- ly regular gasoline retail prices averaged $2.14/gallon on January 12, the lowest since May 4, 2009. U.S. regular gasoline retail prices are projected to average $2.16/gal in the first quarter of 2015. EIA expects U.S. regular gasoline retail prices, which averaged $3.36/gal in 2014, to average $2.33/ gal in 2015. The average household is now expected to spend about $750 less for gasoline in 2015 compared with last year because of lower prices. The projected regular gasoline retail price increases to an average of $2.72/gal in 2016. Natural gas working inventories on January 2 totaled 3.09 trillion cubic feet, 0.25 Tcf (9%) above the level at the same time a year ago and 0.07 Tcf (2%) below the previ- ous five-year average (2010-14). EIA expects the Henry Hub natural gas spot price to average $3.52/million British thermal units this winter compared with $4.51/MMBtu last winter, reflecting both lower-than-expected space heating demand and higher natural gas production this winter. Turning to annual measures, EIA expects the Henry Hub natural gas spot price to average $3.44/MMBtu in 2015 and $3.86/MMBtu in 2016, compared with $4.39/MMBtu in 2014. eIA: lower Crude Oil Prices Further Reduce expected spending on Heating Oil This Winter In its December Short-Term Energy Outlook, EIA expects that average heating oil expenditures by households that use oil as their primary heating fuel during the 2014-15 winter will be 27% ($632) below last winter's expenditures. Heating oil prices have declined with crude oil prices, and EIA expects U.S. heating oil prices to average $3.09 per gallon this winter, 20% lower than last winter, and 15% lower than expected in the October Winter Fuels Outlook (Table 1). Data from the National Weather Service show that November 2014 was 18% colder than the 10-year aver- (excerpted from This week in Petroleum, Dec. 17, 2014)