Oil may fall this week on concern that Europe's economy is showing increasing signs of a slowdown as governments struggle to contain the fiscal crisis and avert a Greek default, according to a Bloomberg News survey.
An index of executive and consumer sentiment in the 17-nation euro area fell to 95 from a revised 98.4 in August, the European Commission in Brussels said on Friday. That's the lowest since December 2009. In Germany, Europe's largest economy, business sentiment decreased for a third month in September and investor confidence dropped to the lowest level in more than two and a half years.
Thirteen of 28 analysts, or 46 per cent, forecast oil will decline through October 7, while eight respondents, or 29 per cent, predicted prices will increase. Seven estimated there will be little change. Last week, 55 per cent of the surveyed analysts projected a drop.
"It will be another down week for oil, as sentiment worsens over the prospects of a looming recession," John Kilduff, a partner at Again Capital LLC, a New York-based hedge fund that focuses on energy, said.
Total products supplied, averaged over four weeks, fell 0.6 per cent to 19 million barrels a day in the period to September 23, the fifth straight weekly decline, according to a US Energy Department report on September 28.
Crude oil for November delivery fell 65 cents, or 0.8 per cent, to $79.20 (Dh290.9) a barrel last week on the New York Mercantile Exchange. Futures have fallen 13 per cent this year.
The oil survey has correctly predicted the direction of futures 47 per cent of the time since its start in April 2004.