Staying Positive about the Future of Oil Prices
Posted: October 21, 2015
Continued volatility in the stock market and a new concern in the Middle East—Russia’s entry into war-torn Syria—recently helped to push crude oil prices above $50 a barrel for the first time since July.
Back in our neighborhood, we saw wholesale fuel prices tick up a few cents per gallon as we entered a new heating season in October.
But we’re keeping calm and carrying on because this is really just business as usual in the energy markets. Prices for commodities like crude oil and heating oil will always have their ebbs and flows over the short-term. We prefer to look at all the positive signs for the future of oil prices:
- With U.S. oil production reaching its highest point in 43 years, most experts believe oil prices will stay lower for the foreseeable future.
- Crude oil prices dipped under the $50 per barrel mark again by mid-October; heating oil prices remain at their lowest level since 2009.
- According to data from the U.S. Energy Dept., the average wholesale heating oil price stood at about $1 less per gallon than at this time a year ago; wholesale propane prices were about 50 cents per gallon lower than mid-October 2014.
- U.S. household expenditures for heating oil this winter are projected to be 25% lower than last winter; propane expenditures will be 18% lower. That’s due to lower fuel prices and lower heating demand.*
- The National Oceanic and Atmospheric Administration forecasts overall heating degree days this winter will be 7% lower than last winter and below the 10-year average.
*Source: Short-Term Energy and Winter Fuels Outlook, U.S. Energy Information Administration, 10-6-15