This is an excerpt from EERE Network News, a weekly electronic newsletter.
EIA Boosts its Long-Term Projections for Oil Costs
World oil prices are expected to drop over the next ten years, but they'll be back up to near today's levels by 2025, according to a report released on December 12th by DOE's Energy Information Administration (EIA). The EIA's latest "Annual Energy Outlook" projects oil prices falling to $47 per barrel in 2014, but rising to $54 per barrel in 2025. That's $21 per barrel higher than the EIA was projecting a year ago. According to EIA, those higher prices will stimulate a greater use of ethanol and biodiesel, as well as technologies to convert coal into liquid fuels. The high prices also reduce demand, and in the new scenario, oil imports supply 60 percent of U.S. petroleum demand in 2025, down from the 68 percent projected in last year's report.
The EIA also anticipates that higher oil and natural gas prices will spur an increased use of coal and nuclear power. The new report projects a 64 percent increase in coal consumption by 2030 along with the addition of 6,000 megawatts of new nuclear power plants. On the other hand, imports of liquefied natural gas (LNG) are expected to grow to 4.1 trillion cubic feet in 2025, down significantly from the 6.4 trillion cubic feet projected last year. Carbon dioxide emissions from energy use are projected to increase at an average annual rate of 1.2 percent between 2004 and 2030, down from the 1.5 percent growth projected last year. And the carbon intensity of the economy, measured as energy-related carbon dioxide emissions per dollar of gross domestic product, is projected to decline at an average annual rate of 1.7 percent per year from 2004 through 2030. See the EIA press release and the Annual Energy Outlook.