NEW YORK, Sept. 11 (UPI) — Crude oil prices took a beating early Friday after an expected decline in market trajectory offset concerns over expected declines in non-OPEC supplies.
West Texas Intermediate, the U.S. benchmark for crude oil prices, opened sharply lower at the start of trading Friday, falling 2.8 percent below the previous close to $44.63 per barrel. Brent crude oil lost about 2.5 percent to start Friday at $47.68.
A forecast from U.S. investment bank Goldman Sachs sparked much of the downward movement in early trading. A report from the bank said crude oil prices should stay depressed for the time being as markets continue to favor the supply side.
The rise of U.S. crude oil production, coupled with a decision from some members of the Organization of Petroleum Exporting Countries to keep output higher, has pushed crude oil prices steadily lower for much of 2015.
Goldman Sachs said WTI would average about $45 per barrel for 2016, down from the previous forecast of $57. Brent should be $49.50 per barrel next year, down from the previous forecast of $62 per barrel.
A report this week from the U.S. Energy Information Administration said WTI could be as low as $32 per barrel. Goldman Sachs said $20 per barrel for WTI is possible.
The International Energy Agency said in its monthly oil market report low crude oil prices are expected to lead to a decline in non-OPEC production by around 500,000 barrels per day, the largest decline in more than 20 years.
Russia, the United States and North Sea output is expected to lead the declines for non-OPEC producers.
“Global oil demand growth is expected to climb to a five-year high of 1.7 million bpd in 2015, before moderating to a still above-trend 1.4 million bpd in 2016 thanks to lower oil prices and a strengthening macroeconomic backdrop,” IEA said.
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