The U.S.' Energy Information Administration (EIA) lowered its crude price forecast for 2020 by $4 per barrel due to uncertainty and low global oil demand expectations that emerged from the coronavirus outbreak in China.
International benchmark Brent crude is now estimated to average $61 per barrel this year and American benchmark West Texas Intermediate (WTI) is expected to average $55.50 a barrel, according to the EIA's Short-Term Energy Outlook (STEO) for February released on Tuesday.
In January's STEO, Brent was anticipated to average $65 a barrel, while WTI was forecast to average $59.50 per barrel.
"The price declines accelerated with concerns about economic growth as a result of the outbreak of coronavirus," the EIA said in its February STEO.
"The magnitude and duration of the coronavirus’s effects remain highly uncertain, but EIA is reducing its estimates for Chinese and global oil consumption for 2020 as a result of the events," it added.
-US oil output forecast down
The EIA has also lowered the U.S.' crude oil production expectation for this year by 100,000 barrels per day (bpd).
Crude oil output in the country is now estimated to average 13.2 million bpd in 2020, instead of the previous forecast of an average of 13.3 million bpd in January's STEO.
The U.S. surpassed Saudi Arabia, and then Russia, in November 2018 to become the world's biggest crude oil producer.
By Ovunc Kutlu