WASHINGTON Heres a shocker: The federal government is forecasting the price of diesel fuel will average close to $4 per gallon this year -- $3.94 to be exact, or a dollar a gallon more than last years average.

You think theres a chance?

Even scarier is the possibility the latest U.S. Department of Energy prediction could be conservative. After all, it was barely six weeks ago the DOE issued a forecast saying diesel would average $3.62 a gallon for the year.

The soaring price of diesel has made fuel costs the second-most-important expense item for most motorcoach operators. One modest-size New York operator reports his weekly fuel bill is now well over $20,000, compared to $12,000 a week a year ago.

In making its latest projection, the Department of Energy said the increase "reflects global strength in diesel demand that is contributing to a widening of the margin between diesel prices and crude oil costs since last year."

In other words, the price of diesel is rising faster than the price of crude oil because theres heavy demand for diesel overseas as a result of a strong worldwide economy.

While demand in the U.S. for petroleum products is down roughly 330,000 barrels a day because of higher prices and a weaker economy, world demand has been growing about 1.2 million barrels a day this year.

Meanwhile, DOE is projecting retail diesel prices will fall next year, averaging about $3.67 per gallon. Diesel averaged $2.88 per gallon last year.

While DOE thinks prices will moderate, oil market analysts disagree sharply on where oil prices are headed in the future.

Goldman Sachs predicted last month that crude prices could soar to $150-$200 a barrel as non-OPEC producers struggle to maintain output, let alone increase it. (The firm predicted three years ago oil prices would top $100 - a prediction that came true in January of this year, and then some.)

"We believe the current energy crisis may be coming to a head, as a lack of adequate supply growth is becoming apparent and resulting in needed demand rationing in the OECD areas, in particular the United States," Goldman Sachs analysts said.

The president of OPEC also is warning that oil prices could hit $200 a barrel, Britains Financial Times reported, quoting Chakib Khelil, Algerias energy minister.

However, a Lehman Brothers analyst is predicting oil prices will fall as low as $80 a barrel next year as world demand drops, and Saudi Arabia tries to impress the incoming president by pumping more oil.

The Saudis rebuffed President George Bush when he asked them last month to pump more oil.

Still, there are several big development projects under way in Saudi Arabia that could boost that nation's output by 1.3 million barrels a day, more than the expected increase in global demand next year.

Other factors that could change next year are the fact the Chinese will no longer be stockpiling oil in advance of the Olympics, and an estimated 28 million barrels Iran is storing in tankers could find a market willing to deal with the difficult-to-refine crude.

And a survey of oil and gas executives by KPMG's Global Energy Institute found that most of them think the price of oil will drop significantly by the end of the year - to below $100.

"The combination of traders moving resources into commodities and the weak dollar has had a significant role in the surge in pricing in recent weeks," said Bill Kimble, executive director for KPMG's Global Energy Institute. "However, ... there are underlying issues in the energy industry, such as escalating energy demand in emerging markets and declining oil reserves, which will continue to contribute to upward pricing pressure for years to come."