Experts split over oil prices

By JANE PADGHAM
Updated:

 

ANALYSTS were today split virtually down the middle on whether the oil price has peaked, or whether it is poised to smash through the $50-abarrel mark.

A Bloomberg poll of 39 energy market experts found 19 expect it to continue sliding after falling sharply this week. Seventeen forecast a rise next week and three reckon prices will stabilise.

US crude today rose 17 cents to $43.27. London's Brent was up 18 cents at $40.51.

In the bears' camp is Rick Mueller at Energy Security Analysis in Wakefield, Massachusetts. 'We are waking up and recognising that a risk premium of $12 to $15 isn't justified,' he said.

'Prices should be in the mid-30s and we are slowly working that way.'

The bulls argue further supply disruptions in Iraq are likely at a time of booming demand and tight global supplies ahead of the Northern Hemisphere winter.

Marshall Steeves at Refco in New York said: 'Despite the dramatic decline in oil prices this week, the uptrend hasn't been broken and violence in Iraq has certainly not been averted.'

A peace agreement between Iraq's government and rebel cleric Moqtada al-Sadr, ending a bloody three-week uprising in Najaf, raised hopes of more reliable oil flows.

Official data this week showing hefty US petrol stocks at the tail-end of the summer driving season have also knocked prices lower.

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