(Reuters) - Standard Chartered lowered its 2016 Brent crude price forecasts by $13 a barrel on Monday, mainly due to the impact of a weaker outlook for the U.S. economy.
The British bank cut its Brent price outlook for this year to $50 per barrel from $63 earlier, while keeping its 2017 outlook unchanged at $78 per barrel.
Standard Chartered said it expected six straight quarters of year-on-year declines in U.S. oil demand, starting Q4-2015, which was likely to be followed by a weak recovery in 2017.
“Should the weakening of the U.S. economy go much further, we would expect OPEC to come back into play with an output cut,” it added.
The bank said supply was likely to show significant stress in 2017, with reducing conventional non-OPEC supply adding to the weakness and slow recovery in shale.
Standard Chartered forecast WTI crude prices at $45 per barrel in 2016 and $72 in 2017.
Oil prices dipped on Monday on a firmer dollar and weaker than expected Chinese trade data that fueled concerns about demand in the world’s biggest energy consumer.
Reporting by Vijaykumar Vedala in Bengaluru; Editing by Greg Mahlich