Crude oil prices started lower Friday as the glut of supply persists in the global market coupled with the American financial services company JP Morgan lowering its price forecast for next year.
Global benchmark Brent crude was trading at $62.12 per barrel at 0720 GMT, down 0.7 percent, after closing Thursday at $62.54 a barrel.
American benchmark West Texas Intermediate was down to $53.38 a barrel around the same time with a 1.2 percent decline, after closing at $54.02 per barrel the day before.
American investment and financial services giant JP Morgan said Thursday that it has lowered its Brent crude price estimate for next year to $73 per barrel, from its previous forecast of $83.50 a barrel.
Scott Darling, head of Asia-Pacific oil and gas at JP Morgan, told CNBC that crude oil supply in North America would rise in the second half of 2019.
He added that the Organization of Petroleum Exporting Countries (OPEC) would need to cut its oil production by 1.2 million barrels per day (mbpd) for the whole of next year in order to balance the global oil market.
JP Morgan also expects Brent crude to go toward $64 per barrel in 2020.
OPEC and Russia will meet on Dec. 6 in Vienna to discuss supply and demand in the global oil market. The group is expected to lower their total output by as much as 1.4 mbpd in order to ramp up oil prices, however, U.S. President Donald Trump is pressuring the oil cartel and its linchpin Saudi Arabia to keep the prices low.
By Ovunc Kutlu