Energizing America: Facts for Addressing Energy Policy Ports-to-Plains Energy Summit Omni Interlocken Resort Broomfield, CO April 7, 2011 Lunch Keynote John Felmy, Chief Economist, American Petroleum Institute

9. Diesel, Gasoline and Crude Prices
4/6/2011
$4.50
Diesel (AAA) $4.02
Gasoline (AAA) $3.73
Crude Oil (NYMEX) $2.59
price per gallon
$3.50
$2.50
$1.50
$0.50
Mar '05 Mar '06 Mar '07 Mar '08 Mar '09 Mar '10 Mar '11
Source: NYMEX (WTI crude oil) and AAA (gasoline and diesel)

10. 4.000
Gasoline and Crude Oil Prices 4/6
AAA, NYMEX 3.725
+104.3
3.500
3.000
2.5912
+88.57
$108.83
2.500
8/26
2.682
2.000
8/24
1.500
1.7055
$71.63
8/25
cbot
$1.829
1.000
8/1/2010 9/1/2010 10/1/2010 11/1/2010 12/1/2010 1/1/2011 2/1/2011 3/1/2011 4/1/2011

11. 0.700
1.200
1.700
2.200
2.700
3.200
3.700
4.200
4.700
1/9/2008
2/9/2008
3/9/2008
4/9/2008
5/9/2008
6/9/2008
7/9/2008
145.18
3.4567
8/9/2008
7/14/08
9/9/2008
$33.87
0.8064
12/19/08
4.114
10/9/2008
7/17/08
11/9/2008
12/9/2008
1/9/2009
2/9/2009
3/9/2009
1.616
4/9/2009
12/29/08
1.848
1/20/09
5/9/2009
6/9/2009
7/9/2009
$1.612
$38.74
0.9224
1/20/09
8/9/2009
9/9/2009
10/9/2009
AAA, NYMEX
11/9/2009
12/9/2009
1/9/2010
2/9/2010
3/9/2010
Gasoline and Crude Oil Prices
4/9/2010
5/9/2010
6/9/2010
7/9/2010
8/9/2010
9/9/2010
10/9/2010
11/9/2010
12/9/2010
1/9/2011
2/9/2011
3.725
2.5912
+187.7
3/9/2011
$108.83
+166.88

13. Oil prices relate to many uncertain factors
Non-OPEC supply
growth Inventories
OPEC production Global economic
decisions growth
Global
Spare production
Oil Prices Speculation, hedging,
capacity investment
Exchange rates and
Geo-political risks
Inflation
Weather
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14. 90
World Oil Demand
IEA - MMBD 89.4
89
88
87.9
87
86.7
86.1
86
85.0
85
84
83
82
2007 2008 2009 2010 2011

15. 9.0
Change in U.S. Petroleum Demand 2010 vs 2009
8.0 7.7%
7.0
6.0
5.0
4.3%
4.0
3.0
2.2%
2.0%
2.0
1.0
0.4%
0.0
Total Gasoline Diesel Jet Fuel Residual

16. World Liquid Fuels Consumption
EIA, Short-Term Energy Outlook, March 2011

17. OPEC Surplus Crude Oil Production Capacity
EIA, Short-Term Energy Outlook, March 2011

20. Percent Change
2009 2010 2011 2012 09-10 10-11 11-12
WTI
a
Crude
($/barrel) 61.65 79.4 101.77 104.75 28.8 28.2 2.9
b
Gasoline
($/gal) 2.35 2.78 3.56 3.57 18.4 27.9 0.5
c
Diesel
($/gal) 2.46 2.99 3.81 3.82 21.5 27.4 0.2
He ating
d
Oil ($/gal) 2.52 2.97 3.7 3.9 17.7 24.6 5.3
Natural
d
Gas
($/mcf) 12.12 11.18 11.2 11.92 -7.8 0.2 6.4
d
Electricity
(cents/kw
h) 11.55 11.58 11.69 11.74 0.2 1 0.5
a b
West Texas Intermediate. Average regular pump price.
c d
On-highw ay retail. U.S. Residential average.
Source: EIA, Short-Term Energy Outlook, March 2011

21. Percent Quadrillion BTUs Quadrillion BTUs Percent
Percent Percent
of Source of Sector
37.4% Petroleum 72 94
35.3 Transportation 28.5%
27.0
Natural Gas
24.8%
23.4 Industrial
19.9%
18.8
Coal
20.9% 19.7
Residential,
Commercial 11.1%
10.6
Renewable
8.2% Energy
7.7
Electric
Nuclear 100 22 Power 40.4%
8.8% Electric Power
38.3
8.3

22. Percent Quadrillion BTUs Quadrillion BTUs Percent
Percent Percent
of Source of Sector
37.4% Petroleum 72 94
35.3 Transportation 28.5%
27.0
Industrial
19.9%
18.8
Residential,
Commercial 11.1%
10.6
Electric
Power 40.4%
38.3
EIA: Annual Energy Review 2009

23. Percent Quadrillion BTUs Quadrillion BTUs Percent
Percent Percent
of Source of Sector
37.4% Petroleum 72 94
35.3 Transportation 28.5%
27.0
Natural Gas
24.8%
23.4
Coal
20.9% 19.7
Renewable
8.2% Energy
7.7
Nuclear
8.8% Electric Power
8.3

24. Percent Quadrillion BTUs Quadrillion BTUs
Percent Percent Elec. Flow
of Source of Sector
37.4% Petroleum 72 94
35.3 Transportation 0.2%
27.0
Natural Gas
24.8%
23.4 Industrial 23.6%
18.8
Coal
20.9% 19.7
Residential, 36.4%
Commercial
35.3%
10.6
Renewable
8.2% Energy
7.7
Electric 4.5%
Nuclear 100 22 Power
8.8% Electric Power
38.3
8.3

28. Oil and Gas Tax Increases in 2012 Budget
Billion $
Repeal LIFO 22.50
Repeal of Sec. 199 for Oil and Natural Gas Companies 18.20
Repeal Expensing of Intangible Drilling Costs 12.40
Repeal of Percentage Depletion 11.20
Modifications of Dual Capacity Rule 10.70
Reinstate Superfund Taxes 10.50
Increase G&G Amortization Period 1.40
0.00 5.00 10.00 15.00 20.00 25.00

29. Capital Spending
Source: Oil and Gas Journal, March 7, 2011