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Short-Term Energy Outlook

Release Date: November 8, 2016  |  Next Release Date: December 6, 2016  |  Full Report    |   Text Only   |   All Tables   |   All Figures


Forecast Highlights

Global liquid fuels

  • U.S. crude oil production averaged 9.4 million barrels per day (b/d) in 2015, and it is forecast to average 8.8 million b/d in 2016 and 8.7 million b/d in 2017. Forecast production in 2017 is more than 0.1 million b/d higher than in last month's STEO.
  • EIA expects Brent crude oil prices will average close to $48/ barrel (b) in the fourth quarter of 2016 and in the first quarter of 2017. Forecast Brent prices average $43/b in 2016 and $51/b in 2017. West Texas Intermediate (WTI) crude oil prices are forecast to average about $1/b less than Brent prices in 2017. The values of futures and options contracts indicate significant uncertainty in the price outlook, with NYMEX contract values for February 2017 delivery traded during the five-day period ending November 3 suggesting that a range from $35/b to $66/b encompasses the market expectation of WTI prices in February 2017 at the 95% confidence level.
  • Higher crude oil prices contributed to U.S. average retail regular gasoline prices in October increasing by 3 cents/gallon (gal) from September to an average of $2.25/gal. With the switch to less-expensive winter gasoline blends and the typical seasonal decline in gasoline consumption, EIA expects gasoline prices to fall to an average of $1.97/gal in January. Retail gasoline prices are forecast to average $2.13/gal in 2016 and $2.27/gal in 2017.
  • Global oil inventory builds are forecast to average 0.8 million b/d in 2016 and 0.5 million b/d in 2017.

Natural gas

  • Natural gas marketed production is forecast to average 77.3 billion cubic feet per day (Bcf/d) in 2016, a 1.4 Bcf/d decline from the 2015 level, which would be the first annual decline since 2005. EIA expects production to start rising in November as a result of increases in drilling activity and infrastructure build-out that connects natural gas production to demand centers. In 2017, forecast natural gas production increases by an average of 2.9 Bcf/d from the 2016 level.
  • Growing domestic natural gas consumption, along with higher pipeline exports to Mexico and liquefied natural gas exports, contribute to the Henry Hub natural gas spot price rising from an average of $2.50/million British thermal units (MMBtu) in 2016 to $3.12/MMBtu in 2017. NYMEX contract values for February 2017 delivery traded during the five-day period ending November 3 suggest that a price range from $2.01/MMBtu to $4.84/MMBtu encompasses the market expectation of Henry Hub natural gas prices in February 2017 at the 95% confidence level.

Electricity, coal, renewables, and emissions

  • EIA forecasts total U.S. generation of electricity from utility-scale plants will be 11.2 terawatthours in 2016, up 0.2% from 2015. Total utility-scale generation grows by 0.5% in 2017.
  • EIA expects the share of U.S. total utility-scale electricity generation from natural gas will average 34% this year, and the share from coal will average 30%. Last year, both fuels supplied about 33% of total U.S. electricity generation. In 2017, natural gas and coal are forecast to generate about 33% and 31% of electricity, respectively, as natural gas prices are forecast to increase. Nonhydropower renewables are forecast to generate 8% of electricity generation in 2016 and 9% in 2017. Generation shares of nuclear and hydropower are forecast to be relatively unchanged from 2016 to 2017.
  • Coal production in October 2016 was 73 million short tons (MMst), the highest monthly production level since October 2015, when it was 76 MMst. Forecast coal production declines by 150 MMst (17%) in 2016 to 747 MMst, which would be the lowest level of coal production since 1978. Forecast coal production increases by 3% in 2017.
  • Electric power sector coal stockpiles decreased to 163 MMst in August 2016, down 5% from the previous month. Although coal stocks are at their lowest levels of the year because of the typical seasonal decline that occurs each summer, they are still 4% above the August 2015 level, when coal stockpiles were 157 MMst.
  • Wind energy capacity at the end of 2015 was 72 gigawatts (GW). EIA expects that 8 GW of capacity will be added in 2016 and 9 GW in 2017. These additions would bring total wind capacity to 89 GW by the end of 2017.

 

What's New in STEO


Based on feedback from our readers, EIA has changed the focus and organization of the Short-Term Energy Outlook (STEO) analysis text and web page, beginning in October. All forecast tables and charts remain the same. The text of the report now includes expanded analysis of current developments in oil and natural gas markets.

Price Summary
  2014 2015 2016 2017
a West Texas Intermediate.
b Average regular pump price.
c On-highway retail.
d U.S. Residential average.
WTI Crude Oila
(dollars per barrel)
93.17 48.67 42.84 49.91
Brent Crude Oil
(dollars per barrel)
98.89 52.32 43.30 50.91
Gasolineb
(dollars per gallon)
3.36 2.43 2.13 2.27
Dieselc
(dollars per gallon)
3.83 2.71 2.32 2.69
Heating Oild
(dollars per gallon)
3.71 2.65 2.12 2.60
Natural Gasd
(dollars per thousand cubic feet)
10.94 10.36 10.15 10.85
Electricityd
(cents per kilowatthour)
12.52 12.67 12.55 12.93

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