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Better Energy and Gas Prices Ahead

Patti McConville | Image Bank | Getty Images

On the road to North American energy independence, the next decade is crucial. And in the New Year, the dramatic rise in U.S. oil production will continue its extraordinary climb.

1. Robust U.S. oil production will keep a lid on prices

At the same time, U.S. petroleum supplies will have a greater reach. In the first quarter of 2013, more of the nation will have access to additional pipeline capacity to alleviate abundant domestic supply — and mitigate any meaningful price gain. After a year full of markets fluctuations, by the end of 2013, oil prices will not have strayed far from where they started the new year.

2. The end of bear market for natural gas is near

It's no secret that we have a lot of natural gas. Enough to have flooded the market with more supply than the nation could have possibly consumed this year, leading to a near collapse in early 2012. But those days may be coming to an end as supply and demand fundamentals begin balancing out.

The question on everyone's minds — from producers to politicians to consumers — is what will we do with all this gas? In the New Year, the U.S. will find more ways to utilize (and pave the way to export) this cheaper, cleaner, alternative fuel. And the increase in demand will set the stage for the ongoing rise in natural gas prices.

3. Goodbye, $4.00 gasoline in 2013

Gasoline prices will continue to vary widely depending on where you live. But an improving supply picture will help alleviate any price increases in the national average next year. In 2013, the return and restart of major refinery units from the east to west coasts, and particularly along the Gulf of Mexico, will enable the production of more gasoline and keep pump prices from topping the $4.00 mark.

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