PARIS – The International Energy Agency forecasts a sharp drop in oil supply from the United States, Russia and other non-OPEC countries because of continued low oil prices.
In its monthly forecast released on Friday, the IEA says non-OPEC production is expected to drop nearly half a million barrels per day to 57.7 million, calling it the biggest decline in over two decades.
Non-OPEC nations include the United States and Canada. The drop may not be fast enough to stabilize prices at current levels, according to new research from Wall Street firm Goldman Sachs Group Inc.
The investment bank said Friday it believes crude prices could fall to as low as $20 a barrel before the glut shrinks and prices rebound.
The IEA said OPEC supply remains higher than last year, but declines in Saudi Arabia, Iraq and Angola pushed OPEC crude supply down in August to 31.6 million barrels a day. The other member nations include Algeria, Ecuador, Iran, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the UAE and Venezuela.
The agency forecast growth in oil demand this year and a slight drop next year.
Amid booming U.S. production and high OPEC output, benchmark oil prices plunged from near $100 (U.S.) a year ago to about $45 this week.