NEW YORK–Oil futures eased Friday after the International Energy Agency said the market would remain oversupplied in 2016 and warned that prices could have further to fall.
Light, sweet crude for August delivery recently traded down 10 cents, or 0.2%, at $52.68 a barrel on the New York Mercantile Exchange. Brent, the global benchmark, traded flat at $58.61 a barrel on ICE Futures Europe.
The IEA on Friday said global demand for oil would slow down next year, as it warned that crude prices could resume a recent downward spiral. In its first forecast for next year, the IEA–which advises industrialized nations on their energy policies–said global oil-demand growth is forecast to slow to 1.2 million barrels a day in 2016. That compares with an average 1.4 million barrels a day this year.
Gasoline consumption grew strongly in the U.S. in the first half of 2015, the IEA said, but that demand can’t hold up prices in an oversupplied market.
“The rebalancing that began when oil markets set off on an initial 60% price drop a year ago has yet to run its course,” the Paris-based agency said in its report. “The bottom of the market may still be ahead.”
The Organization of the Petroleum Exporting Countries is slated to publish its monthly report on Monday.
Commerzbank on Friday cut its Brent price forecast by $10 a barrel to $65 a barrel by the end of the year. In 2016, Commerzbank expects Brent to average $73 a barrel, down from its prior forecast of $78 a barrel.
“The oil market remains in considerable oversupply and there is growing concern that this oversupply will shrink much more slowly than expected, ” the bank said.
Meanwhile, negotiations over an Iranian nuclear deal appear to be headed for a breakdown, with senior Iranian officials saying the U.S. and European powers have backtracked on recent commitments.
If the talks stall or are delayed significantly, Iran will be unable to get sanctions relief and ramp up its oil exports in coming months. This is bullish for oil prices, as markets have been concerned that fresh supply from Iran could add to global oversupply and push down prices further.
Gasoline futures recently fell 0.9% to $2.0277 a gallon. Diesel futures rose 0.1% to $1.7374 a gallon.

By Nicole Friedman