[LONDON] JP Morgan slashed its crude oil price forecasts for this year and next, citing increased production, and said there was a possibility of prices touching new lows this year due to peak seasonal refinery maintenance in October.
The bank lowered its average 2015 forecast for Brent crude and US oil by US$16 per barrel and by US$19 for 2016.
It forecast Brent crude prices at US$54.50 and US$52.50 per barrel in 2015 and 2016 respectively, while lowering its WTI outlook to US$48.50 per barrel in 2015 and US$46.50 next year.
"The pace of weakening refining margins and increase in rig counts are two key events in July that lead to a turn in our expectations," the US investment bank said in a note on Friday.
Crude oil futures touched multi-month lows on Monday after a weekend of mixed data from China showing higher oil imports in July but weaker trade figures overall.
JP Morgan said near-term downside risks to oil prices could come from reduced crude demand in Asia, deteriorating Atlantic Basin crude prospects and potential inventory liquidation by the National Iranian Oil Company.