WASHINGTON - A slow economy is bad in many ways, but it has its advantages when it comes to energy prices. After suffering record-high gasoline and diesel fuel prices in the summer of 2008, motor fuel prices have fallen by 50 percent or more, reaching an average $1.69 per gallon for regular gasoline and $2.45 per gallon for diesel fuel in December 2008. According to the latest projections from U.S. Department of Energy’s (DOE’s) Energy Information Administration (EIA), the slump in fuel prices is expected to continue through 2009, causing the annual average prices for gasoline and diesel fuel to be only $1.87 and $2.27 per gallon, respectively. Natural gas spot prices are also expected to drop from the 2008 average of $9.13 per thousand cubic feet to only $5.78 per thousand cubic feet in 2009. That’s partly because oil prices will also be depressed, averaging $43.25 in 2009.
The EIA projection is based on a 2 percent decline in U.S. gross domestic product in 2009, followed by a 2 percent increase in 2010 as the economy recovers. The expected recovery in 2010 will drive oil prices back up to an average of $54.50 per barrel, says EIA. That increase, in turn, will cause natural gas prices to average $6.63 per thousand cubic feet in 2010, while average retail prices for gasoline and diesel fuel will rise to $2.18 and $2.54 per gallon, respectively.