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D A T E L I NE EIA OUTLOOK: REFINER ACQUI- SITION COST OF CRUDE TO AVERAGE $100 THROUGH 2012 The average refiner acquisition cost of crude oil is expected to remain relatively flat, averaging about $100 per barrel, in 2011 and 2012, the Energy Information Administration (EIA) reported in the Nov. 8 Short-Term Energy Outlook. The value of West Texas Intermediate (WTI) benchmark crude was about $11 per barrel below the U.S. refiner acquisi- tion cost of crude oil in the third quarter of this year, the Outlook noted. West Texas Intermediate crude oil spot prices fell from an average of $110 per bar- rel in April to $86 per barrel in August, and remained near this level through October. Some background: For most of the last 30 years, WTI has traded at a premium over the average U.S. refiner acquisition cost of crude oil. However, the growth in crude oil supply, particularly from Canada and North Dakota, to the midcontinent region where WTI is traded, has not yet been matched by increases in transporta- tion capacity out of the Midwest to the refining centers, such as the Gulf Coast. This transportation bottleneck contributes to the large price discount for WTI relative to other U.S. and world crude oils. After reaching a record price discount in the third quarter of this year, the discount for WTI is now expected to diminish modestly as the flow of crude oil out of the mid-con- tinent region increases. The forecast WTI price discount nar- rows to $8 per barrel by the fourth quarter of 2012, as rail and truck capacity is added to the region. Also from the Outlook: EIA's U.S. and world economic growth assumptions have been lowered from last month's Outlook. World oil-con- sumption-weighted real GDP grows by 3.1 percent in 2012, compared with 3.5 percent in the previous Outlook. Regular-grade gasoline retail prices have fallen by 46 cents per gallon from their peak monthly average this year of $3.91 per gallon for May to $3.45 per gallon for October. This drop in prices results from • • FEATURED NEWS EIA Outlook Supreme Court RFS2 decision CITGO-Venezuela Heating Oil Program 2012 AHR EXPO AHRI shipment data Product case study: Raven OESP 2012 Convention in Providence AHRI announces 2012 leadership falling crude oil prices as well as the nor- mal seasonal decline in consumption and the switch in production from summer- grade gasoline to lower-cost winter-grade gasoline. EIA projects gasoline retail prices to continue to decline, albeit slightly, through the end of the year. BIODIESEL INDUSTRY STATE- MENT ON SUPREME COURT RFS2 DECISION The National Biodiesel Board, the U.S. trade association representing the biodiesel indus- try, released the following statement after the U.S. Supreme Court announced that it has rejected a petition from the National Petrochemical and Refiners Association and the American Petroleum Institute challeng- ing the EPA's Renewable Fuels Standard. "The RFS program is working just as Congress intended. It's creating jobs across the country. It's breaking our addic- tion to oil. It's helping clean our air, and it's reducing greenhouse gases," said Anne Steckel, NBB's vice president of federal affairs. "This year alone, the biodiesel industry is on pace to produce at least 800 million gallons of advanced biofuel while supporting more than 31,000 jobs. We're pleased to see the Supreme Court put an end to this litigation as we continue build- ing a strong U.S. biodiesel industry." Case Background: NPRA's and API's petition challenging the RFS2 regulations was initially rejected on December 21, 2010, in a unanimous deci- sion by the U.S. Court of Appeals for the District of Columbia (D.C. Circuit). On February 3, 2011, NPRA and API filed a petition in the D.C. Circuit requesting an En Banc Rehearing of the litigation. In general, a petition for an En Banc Rehearing is a request for all the judges that comprise the D.C. Circuit to review a matter previously decided by a three-judge panel of the Court. On Friday, April 22, 2011, rejected a request for an En Banc Rehearing of the Renewable Fuels Standard (RFS2) litigation filed by the National Petrochemical and Refiners Association NPRA and the API. NPRA and API filed their petition for a writ of certiorari with the Supreme Court on July 22, 2011. ANNUAL CITGO-VENEZUELA HEATING OIL PROGRAM HELPS FAMILIES IN NEED CITGO President and CEO Alejandro Granado and Citizens Energy Chairman Joseph P. Kennedy II have launched the seventh consecutive year of the CITGO- Venezuela Heating Oil Program. The program will help more than 400,000 people this year in 25 states, including members of over 60 Native American tribes, families living in ten- ant-owned cooperatives, residents of over 250 homeless shelters, and thousands of single-family households. "Over the years, the program has become the most important energy assistance pro- gram by an oil company. For CITGO, it aligns with the humanitarian and solidar- ity principles endorsed by the government of the Bolivarian Republic of Venezuela through its national oil company, Petróleos de Venezuela, S.A. (PDVSA) that we echo in everything we do," said CITGO presi- dent and CEO Alejandro Granado, who was joined by Camden Mayor Dana Redd at the launch event. "CITGO is very proud to mark the seventh anniversary of our Heating Oil Program. Increasing energy costs continue to affect the quality of life for millions of people and impact community organizations that provide critical social www.fueloilnews.com | FUEL OIL NEWS | JANUARY 2012 3