Economy, weather, and CO₂

U.S. macroeconomics
To generate the macroeconomic assumptions in the Short-Term Energy Outlook (STEO), we input STEO energy price forecasts into S&P Global’s Short-Term U.S. Macroeconomic Model to produce a conditional macroeconomic forecast. For more details on the macroeconomic model, see our documentation.

Emissions
We forecast U.S. energy-related carbon dioxide (CO₂) emissions to decrease by 1.7% in 2026 relative to 2025 and to decrease by 0.1% in 2027. In 2026, decreases in CO₂ emissions are due primarily to expected declines in coal consumption and, to a lesser extent, declines in consumption of various petroleum products, most notably motor gasoline and distillate fuel oil. Declines in both coal-related and petroleum-related emissions are expected to continue in 2027 but are offset by rising natural gas-related emissions, largely in the form of natural gas-fired electricity generation, resulting in a net decrease in total CO₂ emissions.

Weather
We expect average temperatures in the final weeks of summer (June—September) to slightly offset warmer-than-average temperatures in July and August. Based on our current forecasts and data from the National Oceanic and Atmospheric Administration, we expect the United States to average 208 cooling degree days (CDDs) in September, 3% more CDDs than September 2025 about the same as the 10-year monthly average. Overall, our forecast assumes 2026 will be warmer than average, supported by warmer weather this summer—5% more CDDs than the 10-year summer average—and 5% fewer heating degree days in the first quarter of 2026 than the 10-year quarterly average.