That's according to the EIA's monthly Short Term Energy Outlook released Tuesday. It says West Texas Intermediate crude oil prices, which averaged $72.32 per barrel last year, are projected to average $101 a barrel in 2008, dropping to $92.50 per barrel in 2009.
"The global oil market remains fundamentally tight entering the second quarter, despite a slowdown in U.S. oil consumption and growing risks to global economic growth," says the report. "The combination of rising world oil consumption and low surplus production capacity is putting upward pressure on oil prices. The flow of investment money into commodities has contributed to crude oil price volatility."
The EIA report predicts that an increase in oil production in non-OPEC countries will contribute to increases in OPEC surplus crude oil production capacity and ease price pressures toward the end of the year.