Oil may decrease next week on speculation that strategic crude reserves may be released if prices climb and that talks may ease tension between Iran and the West, a Bloomberg News survey showed.
Seventeen of 32 analysts, or 53 percent, forecast oil will fall through March 23. Eleven respondents, or 34 percent, predicted prices will rise and four estimated there will be little change. Last week, 50 percent of surveyed analysts expected a decline.
President Barack Obama discussed tapping emergency stockpiles with U.K. Prime Minister David Cameron on March 14, Jay Carney, the White House press secretary, said yesterday. The leaders reached no agreement, according to Carney. Oil fell as much as 1.6 percent yesterday after Reuters reported that two people it didn’t name said the countries had decided to cooperate on a supply release.
“The potential of a strategic reserve release is going to remain in traders’ minds for a while, putting a lid on prices,” said John Kilduff, a partner at Again Capital LLC, a New York- based hedge fund that focuses on energy. “We’re in a diplomatic mode at the moment. It looks like the Iran tensions will be reduced in the near term.”
Catherine Ashton, the European Union’s foreign policy chief, said March 6 that world powers are ready to resume talks with Iran over its disputed atomic work. China, France, Germany, Russia, the U.K. and the U.S. said last week that they wanted sustained talks with the Persian Gulf nation.
The U.S. and its allies say Iran is seeking the capability to make an atomic bomb. Iran says its program is for civilian energy and medical research.
Crude oil for April delivery has declined $1.93, or 1.8 percent, to $105.47 a barrel so far this week on the New York Mercantile Exchange. Futures are up 6.7 percent this year.
The oil survey has correctly predicted the direction of futures 49 percent of the time since its start in April 2004.
Bloomberg’s survey of oil analysts and traders, conducted each Thursday, asks for an assessment of whether crude oil futures are likely to rise, fall or remain neutral in the coming week. The results were: RISE NEUTRAL FALL 11 4 17
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