Oil Trims Losses on EIA Short-Term Outlook

Source:

"EIA increased its oil price forecast for this year and the next."

The Energy Information Administration on Tuesday increased its forecast for the price of oil this year and the next, to an average of $81 a barrel in the fourth quarter of 2010 and $84 a barrel in 2011, slightly above the agency's last month forecast.

Oil prices trimmed their losses after the EIA report, with the September contract losing $1.28, or 1.6%, to $80.19 a barrel. The agency also forecast that the U.S. is likely alone among developed nations in showing "significant increases in oil consumption" of about 150,000 million barrels a day in 2010 and 2011.

The EIA also slightly increased its projected world oil consumption to 1.6 million barrels a day, compared to 1.5 million the month before. OPEC and non-OPEC supply expectations were also raised, however.

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