The Energy Information Administration (search) on Tuesday revised upward its estimate for the average U.S. oil price (search) in the third quarter to $52.83 a barrel from its previous estimate of $51.58.
In its monthly energy forecast, the EIA, the Energy Department's (search) statistical arm, also said it expected the price for U.S. crude to average $55.00 a barrel during the fourth quarter, up from its prior estimate of $53.00. Average monthly U.S. oil prices are forecast to stay above $50 a barrel for rest of 2005 and 2006, EIA said.
U.S. oil demand in the third quarter should average 20.96 million barrels per day, up from a previous estimate of 20.95 million bpd, the EIA also said.
"Oil prices remain sensitive to any incremental oil market tightness. Imbalances (real or perceived) in light product markets could cause light crude oil (search) prices to rise above $55," the agency warned.
For consumers, high crude oil prices are expected to keep retail gas costs above $2 a gallon through 2006, EIA said.
Pump prices are forecast to average $2.17 a gallon through the busy summer driving season, similar to last month's EIA projection but still about 26 higher from last summer.
Truckers will pay even higher prices for fuel, as the projected summer average cost for diesel is $2.22 a gallon, up about 45 cents from last summer, the agency said.
World oil demand for the third quarter will average 84.5 million bpd, down from 84.6 million bpd projected in EIA's earlier forecast.
EIA also said world oil demand in 2006 would average 86.7 million bpd, a decrease from 86.9 million bpd projected in May.