Investing.com - Crude prices pared earlier gains on Friday after OPEC issued a bearish outlook for the oil market this year and forecast a surplus in 2020.
New York-traded West Texas Intermediate crude futures rose 33 cents, or 0.6%, to $54.80 a barrel by 7:55 AM ET (11:55 GMT), well off intraday highs of $55.66.
Brent crude futures, the benchmark for oil prices outside the U.S., traded up 44 cents, or 0.8%, to $58.67, pulling back from an intraday high of $59.49
The oil cartel also admitted that 2020 will likely see a supply surplus as rivals continue to increase production, although it also lowered its forecasts for non-OPEC supply.
“While the outlook for market fundamentals seems somewhat bearish for the rest of the year, given softening economic growth, ongoing global trade issues and slowing oil demand growth, it remains critical to closely monitor the supply/demand balance and assist market stability in the months ahead,” OPEC said in the report.
In July, OPEC and its allies renewed a supply-cutting pact until March 2020, citing the need to avoid a build-up of inventories that could hit prices.
Support for prices from the pact's renewal was short lived and oil is down more than 7% since then.
Saudi Arabia has recently indicated that it would not tolerate the decline in prices, hinting that further steps to cut output in order to support the market.
U.S. shale producers have taken advantage of the gap left by OPEC-led production cuts. Data from the Energy Information Administration released on Wednesday showed that U.S. output last week was 12.3 million barrels per day, just below record highs.
In other energy trading, gasoline futures gained 0.7% to $1.6477 a gallon by 8:01 AM ET (12:01 GMT), while heating oil edged forward 0.1% to $1.8116 a gallon.
Lastly, natural gas futures traded down 2.2% to $2.183 per million British thermal unit.
-- Reuters contributed to this report.