Business | Oil & Gas
Oil could fall this week on rising supplies
Crude oil may fall this week because of rising supplies and declining fuel demand in the US, the country responsible for almost a quarter of global consumption.
- Bloomberg
- Published: 00:15 June 29, 2008
New York: Crude oil may fall this week because of rising supplies and declining fuel demand in the US, the country responsible for almost a quarter of global consumption.
Eleven of 24 analysts surveyed by Bloomberg News, or 46 per cent, said prices will decline through July 3. Nine of the respondents, or 38 per cent, said oil will rise and four forecast little change.
"Demand in the US has certainly been weakening," said Victor Shum, senior principal at Purvin & Gertz Inc. in Singapore. "If there is a clear indication of demand falling in some of the key developing markets, like China, then there will be more significant pull back in oil prices."
US crude oil inventories gained 803,000 barrels to 301.8 million last week, the Energy Department said in a June 25 report. Fuel consumption averaged 20.2 million barrels a day in the past four weeks, down 2.3 per cent from a year earlier.
Crude oil for August delivery rose $4.85, or 3.6 per cent, to settle at $140.21 a barrel last week on the New York Mercantile Exchange. Futures reached $142.99 a barrel, the highest since trading began in 1983. All of the responses were gathered before prices rallied to the record. Analyst responses have been bearish in 23 of the past 24 weeks. The oil survey has correctly predicted the direction of futures 49 per cent of the time since its start in April 2004.
Bloomberg's survey of oil analysts and traders, conducted each Thursday, asks for an assessment of whether crude oil futures are likely to rise, fall or remain neutral in the coming week.
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