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Natural Gas, Renewables, Biofuels, Crude on Growth Trajectory

Linda Hardesty

Energy Manage EIAThe US Energy Information Administration boosted its forecast for US marketed natural gas production by 0.4 percent this year and nearly 1 percent for next year, according to comments of EIA Administrator Adam Sieminski, following the issuance of the November 2013 Short-Term Energy Outlook.

“Domestic natural gas output reached record levels during the past several months despite lower gas prices,” said Sieminski. “Gas from the Marcellus Shale has been the main driver of this production growth. This month’s forecast lowers US natural gas imports by pipeline, mostly from Canada, as domestic gas production increases.”

Electricity:

“Electricity generation from renewable energy sources other than hydropower currently accounts for about 6 percent of total US generation, but renewables play a bigger role in some states. California has experienced strong growth in the use of renewable energy by the power sector. During the first eight months of 2013, renewable energy, including hydropower, supplied 19.1 percent of total electricity generation in California compared with 12.2 percent during the same period five years ago. Development of new renewable energy generating capacity has been encouraged by a combination of an aggressive state renewable portfolio standard, continued federal tax credits, and the implementation of a state greenhouse gas emissions cap-and-trade program.”

Renewables:

“Wind power generation is forecast to grow by 17 percent this year and by nearly 4 percent in 2014, accounting for more than 4 percent of total US electricity generation next year. EIA expects continued robust growth in solar power, with solar generation by the US electric power sector increasing 82 percent this year and jumping another 84 percent in 2014. However, utility-scale solar power will continue to be a small share of total US electric generation at less than 1 percent.”

US Liquid Biofuels:

“US ethanol production has recovered from last year’s drought. Ethanol production increased from an average of 806,000 barrels per day in October 2012 to 892,000 barrels per day this October, and is forecast to grow to 900,000 barrels per day during 2014.“

Crude Oil:

“As EIA predicted back in March, it appears the United States produced more crude oil in October than it imported for the first time since early 1995. Monthly estimated domestic crude oil output averaged 7.7 million barrels per day in October, which was the highest production for any October in 25 years, while oil imports were 7.6 million barrels per day. The discount of WTI crude oil spot prices to Brent crude oil has widened from just over $3 a barrel in July to $9 in October, as refinery demand has returned to normal, lower seasonal demand levels, and US crude inventories have begun to grow at the Cushing, Oklahoma, storage hub. EIA forecasts that growing non-OPEC crude production will continue to outpace refinery demand, leading to an average WTI discount to Brent of $10 per barrel in the fourth quarter of 2013 and $8 per barrel in 2014.”

“After averaging nearly $103 per barrel for three consecutive months from April to June, Brent crude oil prices increased to around $110 per barrel from July through October as a result of strong US refinery demand and supply disruptions in the Middle East. EIA expects that growing non-OPEC crude oil production will help drive Brent crude oil prices lower.”

Coal:

“The increase in coal consumption this year is mainly due to the electric power sector, which burned more coal because of higher natural gas prices. Most of the growth in coal consumption this year is expected to be met by drawing down 35 million short tons in domestic coal inventories US coal production is forecast to increase by 2.7 percent next year as inventories stabilize and coal consumption increases.”



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