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Gas prices set to rise in Montana as travel demand rises

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Posted at 3:07 PM, Apr 09, 2021
and last updated 2021-04-09 17:07:08-04

The U.S. Energy Information Agency (EIA) has released its new short-term energy outlook for the nation.

The April report foresees a significant increase in demand for U.S. oil and gas, while consumers should expect to see higher gas prices for the summer driving season.

From April through September, pump prices are projected to average $2.78 per gallon, up from an average of $2.07 a gallon last summer.

According to the EIA, those numbers reflect higher crude oil prices, and an expected jump in gas consumption as more people drive again as the COVID vaccines are widely distributed.

The bottom line: Each U.S. household will pay an extra $480 for motor fuel in 2021, compared to 2020.

The EIA report also expects U.S. gasoline consumption to rebound. The agency's forecast calls for U.S. gasoline consumption to average 8.6 million barrels per day in 2021. That compares to 8 million barrels per day in 2020, but still below 2019's consumption rate of 9.3 million barrels a day.

The forecast for crude oil production is for the U.S. to average 10.9 million barrels a day in the second quarter of this year, increasing to 11.4 million barrels by the fourth quarter of 2021. In 2022, the forecast shows U.S. crude oil production averaging 11.9 million barrels.

The EIA's forecast of rising U.S. crude oil production is based on expectations that West Texas Intermediate prices will remain above $55 a barrel through the forecast period.

The latest EIA report also includes details on the impact of February's cold snap on domestic crude oil production. The arctic blast that brought sub-zero temperatures as far south as Texas, put a dent in oil production by as much as 0.8 million barrels per day in February.

In Billings, according to GasBuddy.com daily survey of 81 stations, gas prices are unchanged over the past week, averaging $2.68 a gallon Wednesday, nearly 75 cents per gallon higher than a year ago.