Oil will stay above $107 this year

London: Oil prices are expected to average above $107 this year and to stay above $102 for the next two years due to concerns over long term supply constraints and strong demand from emerging markets, a Reuters survey of analysts found.

The monthly survey of 33 analysts put the consensus forecast for US crude in 2008 at an average of $107.13 a barrel, up by more than $10 from the last poll late in April. The average price for oil last year was $72.30.

North Sea Brent is expected to average $106.12 this year, compared with $95.40 in the last poll.

Hikes in oil prices this year have been larger than most analysts' expectations, leading many to raise their forecasts.

Revisions for next year are higher than for 2008. The median forecasts for US crude is above $106 for next year and above $102 in 2010, compared with $92 for both years in the last poll.

The Reuters poll showed oil prices would peak this year as many analysts said high prices had started to dent demand.