EIA cuts oil price forecasts for 2016, 2017

The US Energy Information Administration (EIA) on Tuesday revised its forecast for Brent crude prices to $41.60 per barrel in 2016, down from the July forecast of $43.73/bbl.

Meanwhile, West Texas Intermediate (WTI) is expected to be slightly less than Brent this year at $41.16/bbl and the same price next year, the EIA said in its monthly outlook.

In 2017, both Brent and WTI crude prices are expected to average $51.58/bbl, down from $52.15/bbl forecast in July.

The agency increased its 2016 forecast for world oil demand by 10,000 barrels to 1.45 million barrels per day (bpd), while the estimate for demand growth next year was cut by 40,000 bpd to 1.45 million barrels per day.

The outlook for US crude oil production was slightly raised to an average of 8.7 million barrels per day (mbd) in 2016, and 8.3 mbd in 2016, both rising by 0.1 mbd from last month.

In July, North Sea Brent crude spot prices averaged $45/bbl, a decrease of $3 from June, the EIA said, adding that it was the first monthly decrease since Brent fell to a 12-year low in January 2016.