Oil prices are forecast to be little changed next week as signs of U.S. economic recovery are balanced by concerns that Europe?s debt crisis may hurt growth and fuel demand, according to a Bloomberg News survey.
Fifteen of 36 analysts, or 42 percent, predicted crude oil will be little changed through Nov. 26. Thirteen respondents, or 36 percent, estimated prices will rise and 8 predicted a decline. Last week, 47 percent said futures would rise.
Oil rose to its highest in more than a week yesterday after data from the U.S. Labor Department said that applications for unemployment benefits fell to the lowest level since 2008.
?We expect upward pressure to come from solid demand out of China and the U.S,? said Mike Wittner, head of oil market research at Societe Generale SA in London. ?However, we also expect downward pressure to comes from the Eurozone debt crisis, and worries about China over-tightening to head off inflation.?
Contagion from Europe?s sovereign debt crisis is spreading to Spain, sparking concern that the bailout fund set up in May isn?t large enough to rescue the euro region?s fourth-largest economy.
?European debt concerns will turn to Spain and Portugal causing the dollar to rise, pushing crude oil prices lower,? said John Kilduff, a partner at Again Capital LLC, a New York- based hedge fund focusing on energy. ?In addition, the recent spate of bullish inventory reports will not be repeated in next week?s report.?
Crude supplies rose 1.03 million barrels to 358.6 million in the week ended Nov. 19, according to the Energy Department report. A 2 million-barrel decrease was forecast, according to the median of 16 analyst responses in a Bloomberg News survey.
Crude oil for December delivery rose 0.8 percent to $84.52 a barrel yesterday on the New York Mercantile Exchange, the highest since Nov. 16.
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. The results were: RISE NEUTRAL FALL 13 15 8
To contact the reporter on this story: Grant Smith in London at gsmith52@bloomberg.net
To contact the editor responsible for this story: Stephen Voss on sev@bloomberg.net
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