Amid hefty supply, light oil prices fall again

Light crude oil is trading below $70 a barrel in New York as analysts forecast that oil supplies would rise. US oil inventories probably rose by 1 million barrels last week as refiners processed less crude, a Bloomberg survey of 12 analysts showed.

“Your bearish pressures are still there,’’ said Bill O’Grady, chief strategist for Confluence Investment Management.

Crude oil for September delivery fell $1.15, or 1.6 percent, to settle at $69.45 a barrel on the New York Mercantile Exchange. It was the fourth straight day of declines and the first time crude settled below $70 this month. Oil reached an eight-month high of $73.38 a barrel on June 30.

OPEC raised its 2010 forecast for supply from outside the group to 51.17 million barrels a day as tax incentives slow the output decline in Russia, OPEC’s biggest rival, the organization said.

OPEC produced about 28.7 million barrels a day in the second quarter, little changed from the first quarter, its report showed. The Energy Department forecast OPEC output will rise during the rest of the year, unless prices fall sharply.

The United States estimated light crude oil prices will average $59.94 a barrel this year, as it lowered its outlook for global demand for the first time in three months. Crude has averaged $54.38 a barrel this year.