Natural gas vs. oil in U.S. transportation: Will prices confer an advantage to natural gas?

Although recent weakness in world oil prices has restored at least some temporary comparability between U.S. natural gas prices and those for petroleum products, EIA projects U.S. natural gas prices will rise more slowly as world oil prices recover. Relatively weaker gains in U.S. natural gas prices would support the substitution of natural gas for other fuels-such as petroleum products in transportation-whether such substitution is driven by business or policy decisions. Will U.S. natural gas prices be sustainably lower relative to those for petroleum products so as to support the increased use of natural gas in the transportation sector? An interpretative review of current market developments and recent research finds the answer is yes.