BS: Crude Oil Heads for First Decline in Three Weeks on Supplies
By Grant Smith and Yee Kai Pin
June 25 (Bloomberg) -- Crude oil slipped in New York, heading for its first weekly decline in three weeks, as retreating equity markets and growing supplies sowed doubts about the economic recovery.
Oil traded around $76 a barrel in New York, near its lowest in a week. The Organization of Petroleum Exporting Countries will increase shipments to consumers, according to tanker- tracker Oil Movements, even though crude inventories in the U.S. are 8.4 percent above their seasonal average.
“Inventories are still very high and there is a lot of uncertainty over economies in the U.S., Europe and China,” said Andy Sommer, senior analyst at EGL AG in Dietikon, Switzerland. “Everyone is waiting for fundamentals to tighten or soften and until then the market is trading sideways.”
Crude for August delivery was at $76.53 a barrel, 2 cents higher, in electronic trading on the New York Mercantile Exchange at 9:07 a.m. London time. Brent crude for August delivery was at $76.38 a barrel on the ICE Futures Europe exchange in London, down 9 cents.
Prices are set to decline 0.9 percent this week, ending two weeks of advances. The Stoxx Europe 600 Index is poised for a 2 percent loss this week after four straight weeks of gains.
‘Mood Is Cautious’
Sixteen of 47 analysts, or 34 percent, forecast crude will advance through July 2. Sixteen more respondents predicted that futures will decline. Fifteen said there will be little change. Last week, 52 percent of analysts expected an increase.
“The macro mood is still cautious,” said Toby Hassall, a commodity analyst at CWA Global Markets Pty in Sydney. “The durable goods numbers offered some positives for the demand outlook for oil. I doubt whether crude can rally without general market sentiment improving.”
The Organization of Petroleum Exporting Countries will increase shipments as Asian refiners boost imports to meet demand for driving fuels, according to Oil Movements.
OPEC, which pumps about 40 percent of the world’s crude, will ship 23.73 million barrels a day in the four weeks to July 10, up 0.7 percent from the month ended June 12, the Halifax, England-based consultant said in a report yesterday. The data excludes Ecuador and Angola.
The International Energy Agency, an adviser to oil- consuming nations, said on June 23 growth in world fuel demand will decline over the next five years as the pace of Chinese consumption slows.
The IEA estimates annual demand growth will slow every year to average 1 percent in 2015, or 940,000 barrels a day, from 1.9 percent, or 1.62 million barrels a day, in 2010, it said on June 23 in its Medium-Term Oil and Gas Markets 2010 report.
--With assistance by Christian Schmollinger in Singapore. Editors: John Buckley, Randall Hackley
To contact the reporters on this story: Yee Kai Pin in Singapore at kyee13@bloomberg.net Grant Smith in London at gsmith52@bloomberg.net
To contact the editor responsible for this story: Stephen Voss on sev@bloomberg.net
