Oil, gasoline prices to fall more than forecast

The average price of domestic oil and gasoline will be less than previously forecast through the remainder of 2012 because of weak demand and increased world supplies, the U.S. Energy Information Administration says. The Houston Chronicle reports the price of West Texas Intermediate crude—which is used as a benchmark for domestic oil—will be about $95 a barrel through the remainder of the year. That’s $11 lower than a price projection reported last month, the administration says in its latest short-term energy outlook. Gasoline prices will also be lower than previously forecast, down from $3.79 for a gallon of regular to $3.60, because of the decline in oil prices, according to the outlook. WTI prices fell dramatically from $106 a barrel on May 1 to $83 on June 1 as concerns have grown about low oil demand in a weak world economy, the administration says. Oil production has outpaced consumption so far this year, a trend that’s expected to continue. Global oil and liquid fuels production is expected to be 1.2 million barrels a day more than current demand through the end of June, the EIA says. See the EIA’s complete short-term energy outlook here.