Crude oil may decline next week on speculation that U.S. inventories will increase because the recession has cut consumption.
Crude oil may decline next week on speculation that U.S. inventories will increase because the recession has cut consumption. Sixteen of 30 analysts surveyed by Bloomberg News, or 53 percent, said futures will fall through April 3, the most bearish response since November. Nine respondents, or 30 percent, forecast oil prices will increase and five said that there will be little change. Last week, 52 percent of analysts expected prices would decline. U.S. oil supplies rose 3.3 million barrels to 356.6 million last week, the highest since July 1993, an Energy Department report on March 25 showed. Total daily fuel demand averaged over the past four weeks was 19.1 million barrels, down 3.2 percent from a year earlier.
?Crude stocks are at a 16-year high, making the market vulnerable on the downside, at least for now,? said Tim Evans, an energy analyst with Citi Futures Perspective in New York.
Crude oil for May delivery rose 31 cents, or 0.6 percent, to $52.38 a barrel this week on the New York Mercantile Exchange. Yesterday"s settlement was the highest since Nov. 28. Prices have dropped 64 percent from the record $147.27 a barrel reached on July 11.
The oil survey has correctly predicted the direction of futures 48 percent of the time since its start in April 2004.