Oil prices have fallen following a forecast by the International Energy Agency (IEA) that the global oil oversupply would continue in 2016 due to low demand growth.
Global benchmark Brent crude fell 20 cents a barrel at $49.66, while the US crude fell 30 cents at $46.80, Reuters reported.
Go deeper with GlobalData
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
IEA said: "A projected marked slowdown in demand growth next year and the anticipated arrival of additional Iranian barrels, should international sanctions be eased, are likely to keep the market oversupplied through 2016."
News of higher production by the Organization of the Petroleum Exporting Countries (OPEC) and expectations of higher US inventories led to a decline of over 5% of oil prices on Monday.
In its monthly report, the agency said in 2016, the global oil demand would increase by 1.21 million barrels per day (bpd), representing a 150,000bpd fall from its forecast last month.
According to the IEA, OPEC is expected to increase supply in September by 90,000bpd to 31.72 million bpd and crude oil output may remain around 31.5 million bpd in the coming months.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalDataA drop in oil prices due to oversupply has led to a downgrade in supply forecasts from the US, which is outside OPEC.
Investors are keenly watching for data to be released on US oil inventories due later on Tuesday and on Wednesday.
