Federal officials estimate the prices of crude oil will fall slightly this year compared to late 2014 before rebounding in 2016.
The U.S. Energy Information Administration's short-term energy outlook projects the average monthly price of crude on the Brent index at $58 per barrel in 2015, down from the December average of $62 per barrel — already the lowest price since May 2009.
Prices on the Brent index are projected to increase to a monthly average of $75 per barrel in 2016, though that would still fall below the index's June 2014 peak of $112 per barrel.
Prices on the West Texas Intermediate index are expected to be $3 to $4 less per barrel than the Brent index going forward, matching the $59 per barrel price in December. The EIA report, however, cautioned that current futures and options contracts suggest "very high uncertainty in the price outlook."
Crude prices on both indexes fell by nearly half between mid-2014 and the end of the year as production increases exceeded global demand. The decline has continued this year, with the Brent index below $46 per barrel in trading Tuesday.
The drop has bolstered consumers' spending power in the U.S. amid falling gas prices and is projected to boost economic growth, but it has also led to market volatility and could potentially impact industries tied to the North American natural gas boom.
Falling oil prices have also wreaked havoc in foreign markets, particularly Russia, where the value of the ruble dropped by about half against the dollar last year.
The EIA forecast estimates U.S. crude oil production will continue to rise this year and next, climbing to 9.3 million barrels per day in 2015 and 9.5 million in 2016. Should the 2016 estimate hold, it would be the second-highest production year in history, narrowly trailing the 9.6 million barrels per day in 1970.
Gas prices, meanwhile, are expected to average $2.33 per gallon this year and $2.72 per gallon in 2016. Both numbers are up slightly from last month's numbers but well behind the overall 2014 average of $3.36 per gallon.