Oil prices have bottomed out, will rise slightly in 2016: IEA

Crude prices appear to have bottomed out and will probably climb through the year as the supply glut eases due to investment cuts, Reuters reported, citing a senior analyst at the International Energy Agency (IEA).

Global benchmark Brent crude rose above $37-mark for a brief while on Tuesday, and was last trading 0.33 percent lower at $36.69 a barrel.

"Oil prices appear to have bottomed out," Neil Atkinson, the new head of IEA's oil industry and market division, told a seminar in Oslo.

"Prices are expected to grow throughout 2016 and into 2017, reflecting expectations that the market is going back into balance in 2017," he added.

In its medium-term outlook published on February 22, IEA forecast oil market to begin rebalancing in 2017 as U.S. production was expected to decline.

The correction, however, could be affected by a renewed increase in U.S. shale, once prices are profitable again.

"As soon as oil rises to $40-50 per barrel, it will give a signal to light tight oil producers (to ramp up)," Atkinson said.

The IEA expects prices to reach $80 per barrel by 2020, with U.S. oil production reaching a record high of 14.2 million barrels per day by 2021.