2. Crude Oil, Heating Oil, and Propane Market Outlook Briefing for the State Heating Oil and Propane Program Conference Wilmington, DE by Douglas MacIntyre Petroleum Division, Energy Information Administration August 13, 2001

3. Short-Term World Oil Price Forecast West Texas Intermediate (WTI) Sources: History: EIA; Projections: Short-Term Energy Outlook, August 2001.

4. Price Movements Related to Supply/Demand Balance *Total includes commercial and government stocks. Sources: History: EIA; Projections: Short-Term Energy Outlook, August 2001.

5. OPEC Production Likely To Remain Low History Projections Sources: History: EIA; Projections: Short-Term Energy Outlook, August 2001.

6. U.S. Reflects World Market Sources: History: EIA; Projections: Short-Term Energy Outlook, August 2001.

7. Crude Oil Outlook Conclusions Iraqi export changes lag in impact on U.S. OPEC crude oil production cuts could make for a tight situation this winter WTI prices could average $28-$30 per barrel or higher this winter

8. Distillate Prices Increase With Crude Oil

9. Distillate Stocks on the East Coast Were Very Low Entering Last Winter Source: Energy Information Administration

10. Distillate Demand Strong Last Winter Sources: History: EIA; Projections: Short-Term Energy Outlook, August 2001.

11. More Supply Possible This Fall than Forecast Sources: History: EIA; Projections: Short-Term Energy Outlook, August 2001.

12. Distillate Fuel Oil Imports Could Be Available - For A Price Sources: History: EIA; Projections: Short-Term Energy Outlook, August 2001.

13. Distillate Supply/Demand Balance Reflected in Spreads

14. Distillate Stocks Expected to Remain Low Sources: History: EIA; Projections: Short-Term Energy Outlook, August 2001.

15. Winter Crude Oil and Distillate Price Outlook Sources: History: EIA; Projections: Short-Term Energy Outlook, August 2001.

16. Heating Oil Outlook Conclusion Distillate stocks are likely to be higher than last year, but still relatively low Prices likely to average a little lower than last winter given current crude oil price forecast Residential customers should be able to purchase less fuel this winter, even if weather is normal Lower price times lower volumes equals lower bills this winter than the high ones from last year

17. Propane Prices Follow Crude Oil

18. U.S. Propane Production Source: Energy Information Administration

19. Propane Production by Source Source: Energy Information Administration

20. U.S. Propane Imports Source: Energy Information Administration

21. Propane Demand is Highly Seasonal, But Fresh Supply is Not Source: Energy Information Administration

22. U.S. Propane Stocks Average Range Lower Operational Inventory = 18.5 Million Barrels Actual Forecast Source: Energy Information Administration

23. PAD District II Stocks (Midwest) Average Range Source: Energy Information Administration

24. Average Range Source: Energy Information Administration PAD District III Stocks (Gulf Coast)

25. Propane Outlook Conclusion Lower residential prices possible this winter U.S. inventories likely to be ample prior to the heating season. –However, Midwest inventories remain relatively low Demand uncertain due to weather and economy. Lower natural gas prices likely to avert gas plant shut-ins. But, temporary supply shortages may still occur due to existing bottlenecks in delivery system.