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U.S. Lowers Forecast for Summer 2013 Gasoline Prices

U.S. Lowers Forecast for Summer 2013 Gasoline Prices
The Energy Information Administration expects regular-grade gasoline will average $3.53 a gallon from April through September, down from the April estimate of $3.63 a gallon. Photographer: Daniel Acker/Bloomberg

May 7 (Bloomberg) -- The Energy Information Administration lowered its forecast for summer 2013 gasoline prices.

U.S. consumers will pay an average 16 cents a gallon less for gasoline this summer than a year ago, the statistical arm of the Energy Department said today in its monthly Short-Term Energy Outlook. The EIA’s April forecast predicted prices would average 6 cents a gallon less than in 2012.

The agency expects regular-grade gasoline will average $3.53 a gallon from April through September, down from the April estimate of $3.63 a gallon. Diesel fuel will average $3.88 a gallon, less than the prior forecast of 3.94.

“U.S. drivers will get a break at the pump this summer as the average gasoline price is now expected to be $3.53 a gallon, 16 cents less than last summer and significantly lower than the $3.78 per gallon peak price reached in late February,” Adam Sieminski, the EIA’s administrator, said in an e-mailed statement.

Lower crude prices will keep motorists’ costs in check, according to the EIA. Brent, the pricing basis for U.S. oil imports, is down 7.1 percent from a year ago, while West Texas Intermediate, the U.S. benchmark, has dropped 2.2 percent. Regular gasoline, which averaged $3.538 a gallon in the week ended yesterday, is 25.2 cents a gallon below a year earlier, the EIA said yesterday.

Lower Prices

The EIA lowered its forecast for gasoline prices at the pump for all of 2013 and reduced its estimate for demand.

Regular-grade gasoline will average $3.50 a gallon this year, down from last month’s forecast of $3.56. Prices in 2012 averaged $3.63 a gallon.

Prices may average $3.39 in 2014, the department estimated, unchanged from the April forecast.

Gasoline consumption this year will average 8.68 million barrels a day, lower than the 8.69 million in last month’s projection. Demand in 2014 may be 8.69 million barrels a day, down from last month’s forecast of 8.7 million.

Distillate demand, including diesel and heating oil, will be 3.8 million barrels a day this year, up from last month’s outlook of 3.79 million. Consumption in 2014 is estimated to be 3.81 million, unchanged from the previous forecast.

To contact the reporter on this story: Barbara Powell in Dallas at bpowell4@bloomberg.net

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net

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