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JP Morgan lowers oil price forecasts due to weak demand and higher output

JP Morgan lowers oil price forecasts due to weak demand and higher output

JP Morgan lowered Monday its oil price predictions for 2025 as well as next year. They cited higher production by OPEC+, and weaker demand.

The bank lowered its forecast for 2025 Brent prices to $62 per barrel, down from $73, and its target price for 2026 to $58 per barrel, up from $61. The bank lowered its 2025 WTI forecast to $62 from $69 per barrel and its 2026 outlook to $53 from $71.

Brent crude futures traded around $65 and U.S. West Texas Intermediate Crude futures around $61.

JP Morgan expects the global oil demand to rise by 0.8 millions barrels per daily (mbd), but only a growth of 0.3 mbd on average in the third quarter.

The bank stated in a report that "higher production volumes by the OPEC+ Alliance indicate a change in reaction function. This, combined with weaker demands, will push the balances to a large excess and drive Brent below $60 at the end of the year."

Analysts at JP Morgan said that the oil market is still under pressure due to an "80% chance of a mild economic recession, coupled with an increase of 1 mbd in production" by the Organization of Petroleum Exporting Countries.

JP Morgan stated that while OPEC+ will gain market share by 2025, to stabilize the market at $60 Brent for 2026, the alliance would need to not only reverse the current production increases but also implement further reductions.

This month has been a busy one for us.

Goldman Sachs has reduced its

Brent and WTI Oil Forecasts for 2025-2026 will be based on an expectation of increased OPEC+ oil supply, and the possibility of escalating trade conflicts. This will cause a global recession and dent demand.

(source: Reuters)