EIA Predicts Strong Ethanol Rebound In 2014

The U.S. Energy Information Administration (EIA) has released the January issue of its Short-Term Energy Outlook, which is the first to include forecasts for 2014. The EIA’s analysis predicts that ethanol production will rebound, beginning in the second half of 2013.

www.eia.gov/forecasts/steo/report/renew_co2.cfm

According to the outlook, fuel ethanol production fell from an average of 900,000 barrels per day in the first half of 2012 to an average of 820,000 barrels per day during the second half of the year.

Overall, ethanol production is expected to average 915,000 barrels per day, or 14 billion gallons per year, in 2014. The production, along with banked renewable identification numbers (RINs) are expected to help meet the 2014 RFS mandate. Furthermore, the EIA said it expects ethanol’s share in the gasoline pool to increase from an average volume of 9.6% in 2012 to just under 11% by the end of 2014. The EIA specifies that the E15 and E85 fueling infrastructure will need to increase to allow for the volume increase.

With regard to gasoline prices, the EIA noted that it expects falling crude prices to drop the national average price for a gallon of gasoline from $3.63 in 2012 to $3.44 in 2013 and $3.34 in 2014.