The prospects for significant improvement in the world petroleum supply and demand balance appear to be fading.  While U.S. production in 2006 will grow with recovery from the hurricanes, only moderate increases in OPEC and other non-OPEC production and capacity are expected.  Steady and continued growth in world oil demand will likely combine with only modest increases in world oil production capacity leaving little room to increase production in the event of geopolitical instability.  Crude oil prices will remain high through 2007.