Another hot spot will be natural gas. But U.S. production has been flat for six years. Big fields are hard to find and new technology depletes wells at much faster rates than in the past. Electric utilities have begun to seriously consider other fuel sources, such as coal, for new power plants. Given the tightness across all petroleum markets, the coal industry could see one of its best years in decades.
Gasoline is likely to remain in tight supply as well.
While falling oil prices will translate into lower prices at the pump, strong demand for gasoline is bumping up against an industry that has seen capacity shrink in the past 20 years. In 1980, the U.S. refining industry produced 18 million bbl. per day. Today, in spite of increased demand, that number is around 16 million bbl. Things may get even tighter. So far, California is the only state to announce such a plan.