Oil price expectations pick up

The continuing global recession will lead to steady oil prices across 2009, a poll from news agency Reuters has indicated.

A survey of experts suggested that the price of US crude will average out at $50.85, up from March’s annual forecast of $49.73.

This is the first increase in the monthly forecast since last July, when the analysts raised their 2009 expectations to $115.77.

However, this rise occurred during the apex of the commodities boom, when crude hit an all-time record high of $147 per barrel.

Prices plunged to below $40 later in the year due to the worsening of the credit crisis and a collapse in global demand in the economic downturn, leading to months of lowered expectations from the Reuters poll.

’I certainly think the change in forecasts signals a bottoming out of the market, which was looking for some stability and a price range, and we seemed to have found it,’ Francisco Blanch, head of global commodities research at Bank of America Securities-Merrill Lynch, told the news agency.

David Stedman, analyst at Daiwa Institute of Research, added: ’I don’t think prices will move too far from where we are right now, but I do think there is an improvement in the second half.’

Both Brent Crude and West Texas Intermediate Crude were trading at just over $50 a barrel on the futures markets this morning.

Around 30 analysts were quizzed by Reuters for the latest poll.ADNFCR-2318-ID-19145564-ADNFCR