By Michael Kanellos
Well, it was fun while it lasted.
Crude oil and natural gas prices plummeted with the global economic collapse, one of the few bright spots of that debacle. West Texas Intermediate dropped from an average of $100 a barrel in 2008 to an expected $42 a barrel in 2009, according to the short-term outlook published by the Energy Information Agency.
But prices are going to rebound as demand and the economy recover. The average price for a barrel of oil will rise to $53, slightly lower than earlier forecasts but still an upward trend.
Gas prices dropped to $1.69 a gallon in December, the lowest price since February 2004. Last month, however, they rose to $1.92. For 2009, the average will likely come to $1.96. For 2010, expect to see average prices of $2.18.
The same is occurring with natural gas. The average price for a thousand cubic feet dropped from $9.13 in 2008 to $4.70 this year, but it will rebound to $5.90. The EIA is working off an assumption that the GDP will decline by 2.8 percent this year and grow by 1.9 percent in 2010.
A rise in prices, of course, makes those biofuel investments look that much better.