Some analysts are expecting crude prices to rise in 2009

Tag : oil fuel
"We think a protracting economic slowdown will lead to slowingdemand growth and this will be the dominant factor in driving oilprice down," said Thorsten Fischer at Royal Bank of Scotland (nyse: RBS - news - people ).
The consensus forecast is for U.S. crude to average $112.79 abarrel in 2008, down almost $4 from August's $116.58 forecast.
The September forecast for European benchmark Brent in 2008 is$111.46 a barrel, down from $114.99 last month.
In August, the poll showed a fall in consensus forecasts for U.S.crude for a current year for the first time since early 2007, aftera sharp rise in prices in the first seven months of the year hadforced most analysts to raise their estimates several times.
Oil prices have fallen from a peak of $147.27 for U.S. crude onJuly 11 on evidence of weakening oil consumption in the UnitedStates, the world's top consumer, and Europe, as well as highersupplies.
Despite the consensus forecast decreases in September, someanalysts are still expecting crude prices to rise in 2009 andbeyond on increased demand in emerging markets.
"We think oil demand will decline in Europe and U.S. but this willbe outweighed by demand in countries like China, and so globaldemand will increase," said Thorsten Proettel at Landesbank.
Proettel added: "We think oil has been heavily oversold and westill see prices moving higher in the future."
More than 10 analysts lowered forecasts and assumptions in theSeptember poll, while most others kept their figures unchanged fromAugust.
The September poll shows U.S. crude will average $108.60 in 2009,compared with $113.21 in August's poll. The 2010 average is $106.84compared with $107.88 in the previous poll.
Forecasts for U.S. crude range from $82 at Morgan Stanley (nyse: MS - news - people ) to $130 at ING (nyse: IND - news - people ) for 2009, while the 2009 average forecast for Brent rangesbetween $81 and $130 with the same banks.
Goldman Sachs (nyse: GS - news - people ), which has been a leading price bull, reduced its near-termforecasts.
However, the bank said in a note on Sept. 16 that it stands by itsbullish view, but thinks it will now take longer to reach theprevious price targets.
Standard Chartered (other-otc: SCBEF.PK - news - people ) analysts said they expect a significant strengthening of thedollar in the first half of 2009 to trigger a further correction inoil prices, and have reduced their average forecast for 2009.
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