J.P. Morgan says oil prices will reach $34 per barrel in fourth quarter

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J.P. Morgan says oil prices will reach $34 per barrel in fourth quarter

J.P. Morgan has forecast that international crude oil prices will reach $34 per barrel in the fourth quarter due to an early boom in the purchase of heating oil.

In a recent report, the U.S. investment bank also said that limitations to oil refining and shipping would also make oil prices remain high.

However, the level of crude oil prices will depend on the release of U.S. strategic oil reserves and the weather this winter.

For the whole of this year, international prices of West Texas Intermediate crude oil will average $30.8 per barrel, J.P. Morgan projected.

After reaching a peak in the fourth quarter, crude oil prices will fall to $29 per barrel in the first quarter of next year and to $25 per barrel in the fourth quarter, averaging $27 per barrel for the entire year.

Prices of crude oil produced by OPEC will average $31.8 per barrel in the fourth quarter of this year. OPEC crude oil prices will drop to $24.4 per barrel in the January-March period of next year and $22.7 per barrel in the fourth quarter.

Meanwhile, the global economic growth rate will fall sharply to 3.5 percent in the second quarter of this year, compared with a 5.2 percent jump in the first half.

The investment bank cited a slowdown in U.S. spending and expenditures, a slump in the economic growth of Japan and developing countries and high crude oil prices.

The pace of global economic growth will depend on the sustainability of U.S. investments in information technology, a recovery in the Japanese economy and the impact of high oil prices on European and emerging economies, J.P. Morgan projected.

Accordingly, most central banks of advanced countries are expected to maintain interest rates at their current levels this year, while raising them next year when their economies perk up and inflationary pressures build up, it said. (KYS)

Updated: 09/28/2000

http://www.koreaherald.co.kr/news/2000/09/__05/20000928_0530.htm

-- Carl Jenkins (Somewherepress@aol.com), September 27, 2000


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