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Oil prices dip on new forecasts

17 April 2009 09:33 (UTC +04:00)

Baku-APA-Economics. Crude oil fell, poised for the biggest weekly decline since February, amid forecasts the recession will curb demand at a time when U.S. inventories are already at their highest in almost 19 years.

U.S. crude-oil inventories rose 5.67 million barrels to 366.7 million last week, the highest since September 1990, the Energy Department said April 15. The International Energy Agency reported April 10 that worldwide consumption will shrink by 2.8 percent in 2009 as the global economy contracts.

Crude oil for May delivery fell as much as 48 cents, or 1 percent, to $49.50 a barrel, and traded at $49.69 on the New York Mercantile Exchange. Oil has dropped 4.9 percent this week, set for its sharpest decline since the week ended Feb. 13.

Oil in New York has tumbled 66 percent from a record $147.27 a barrel in July as the recession in major consuming countries curbed fuel demand.

U.S. fuel demand in the first quarter fell to the lowest for the period in 11 years, the American Petroleum Institute said in a monthly report yesterday. Deliveries of petroleum products, a measure of consumption, averaged 19.2 million barrels a day, 3.4 percent less than during the same period in 2008, the industry-funded API said.
OPEC will load about 22.2 million barrels a day in the four weeks ending May 2, down from 22.8 million a day in the month ended April 4, Oil Movements, the Halifax, England-based tanker- tracker, said yesterday in a report.
OPEC agreed at three meetings last year that the 11 members with quotas would cut output by 4.2 million barrels a day to 24.845 million. The members with production targets, all except Iraq, pumped 25.567 million barrels a day in March, according to a monthly report the organization released April 15.
West Texas Intermediate crude oil, the U.S. benchmark, will average $45 a barrel in 2009, according to a report from Moodyâ€™s Investors Service. Thatâ€™s down from the rating companyâ€™s previous estimate that prices would average $50 this year. WTI is forecast to average $50 in 2010, down from a previous forecast of $55.
Brent crude oil for June settlement was at $52.90 a barrel, down 16 cents on Londonâ€™s ICE Futures Europe exchange. Source: Bloomberg