US crude oil is expected to average USD 81.06 a barrel in 2010, a Reuters poll showed on Monday, as analysts point to growing demand in emerging economies, especially China, as prime drivers.
The poll of 30 analysts showed a rising consensus forecast for the twelfth consecutive month. In April last year, the average forecast for 2010 was USD 65.95 a barrel. In March, analysts forecast a year-end price of USD 78.91.
"The rebound in crude oil comes as low interest rates and ample liquidity continue to make commodities an attractive alternative investment," said Thorsten Fischer at Royal Bank of Scotland, who upped their year-end price to USD 79.90 from USD 74.80 in March.
"China also recorded stellar growth and a strengthening of domestic activity. Higher growth expectations have fuelled the rally even as storage remains full and actual demand has yet to pick up noticeably."
Chinese economic growth in the first quarter of 2010 was up 11.9% compared with a year earlier, surpassing expectations, marking the fastest rate of expansion since 2007, although this figure was flattered by a low base of comparison in 2009.
Chinese oil companies built up 340,000 tonnes (2.3 million barrels) of crude oil stocks in March to set their inventory at 28.54 million tonnes at the end of the month, 1.2% more than in February and equivalent to 50 days of net imports.
Analyst Eugen Weinberg at Commerzbank said prices would likely drop slightly as oil supply is rising to meet demand. He forecast a drop from USD 71 a barrel in the second quarter to USD 65 a barrel in the third quarter, and a year-end price of USD 71.
"The rise in demand for oil is still coming almost exclusively from emerging countries, especially China. As oil supply is rising at the same time, the market is unlikely to tighten," Weinberg said
Short-term
US crude is expected to average USD 80.20 in the second quarter of 2010, up from USd 77.15 in the last poll.
US crude prices have traded between a high of USD 87.09 and a low of USD 80.53 in April. Oil briefly dipped to USD 78.57 a barrel in March.
Last week, the discount for front-month US crude futures relative to barrels for delivery in the next month reached its deepest in four months, as June barrels sold for as much as USD 2.21 less than July barrels.
