Prices may rise if US Fed decides on an asset purchase program of $500bn or more - analysts
Brent crude prices may rise above $90 a barrel by the
end of the year because of the US’s quantitative easing program, Bank
of America Corp’s Merrill Lynch unit said.
for December settlement on London’s ICE Future’s Europe exchange traded
near $85 a barrel today. Prices have gained as global oil consumption
strengthens on expectations the Federal Reserve will announce a fresh
round of unorthodox stimulus.
demand on a robust upward trend, winter weather around the corner and
more QE ahead, we believe global oil demand is set to hit a new record
in 2011,” analysts led by Francisco Blanch said in a report dated
Brent could surpass $90 if the Fed decides on an asset purchase program
of $500bn or more. Economists surveyed by Bloomberg forecast that
the plan to be announced by policy makers on Wednesday will be for at least
repeated its expectation that oil prices will rise to $100 next year.
It forecasts that futures traded in New York and London will average
$85 a barrel in 2011.
will “inevitably draw at a fast pace” as global consumption hits a
record next year, unless the Organization of Petroleum Exporting
Countries boosts supplies, according to Merrill.