Such disclosures from a respected agency, combined with persistent signs throughout this week that the crude industry could compensate for losses of Iran exports without incurring undue tightening, seemed to baffle media that for the past few months had been predicting calamity due to the USA sanctions against the Islamic republic.
Global benchmark were at $74.63 per barrel at 0422 GMT, down 18 cents, or 0.2 percent, from their last close. Brent had lost 2.2% on Wednesday. United States crude was down 3.6 per cent on the week, while Brent crude fell 4.1 per cent.
USA light crude dropped $1.42, or 1.9%, to $71.75 US after hitting a low of $71.63. Opec made a similar move on Thursday.
Global oil prices slipped on Thursday, weighed down by the escalating trade dispute between the United States and China, although a decline in USA commercial crude inventories offered some support.
Crude inventories climbed by 6 million barrels in the week to October 5, the U.S. Energy Information Administration reported, compared with analyst expectations for an increase of 2.6 million barrels. Canada's main benchmark crude index, Western Canada Select (WCS) is now trading at $26.2 per barrel, which is nearly $55 barrel per barrel discount to Brent and $45 per barrel discount to WTI.
Earlier this week, the International Monetary Fund slightly downgraded its projection for global growth for this year and next-at 3.7 percent, growth is now expected 0.2 percentage point lower than IMF's forecast from April this year.
Oil has retreated about 6 percent after reaching a four-year high earlier this month. The contract declined $2.83 to $80.26 on Thursday.
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This was enough for Stephen Brennock, oil analyst at PVM, to warn that, "The bearish alarm bells are ringing for next year's oil balance as market players brace for the return of a supply surplus".
"This strain could be with us for some time and it will likely be accompanied by higher prices, however much we regret them and their potential negative impact on the global economy", the agency said in its report.
Stock markets in Asia plunged to a 19-month low on Thursday after Wall Street's worst losses in eight months led to broader risk aversion, a rise in market volatility gauges and concerns over overvalued stock markets in an environment of rapidly rising dollar yields.
Oil traders will watch for the weekly USA drilling rig count, an indicator of upcoming production, which is due at about 1 p.m. from Baker Hughes.
On Friday, the IEA also downgraded oil demand growth forecast for 2018 and 2019 by 110,000 bpd for both years, to 1.3 million bpd this year and to 1.4 million bpd next year, respectively, on the back of a weaker economic outlook, trade concerns, higher oil prices, and a revision to Chinese data.
In the U.S. Gulf of Mexico, producers had cut output by 40 percent on Thursday due to Hurricane Michael, according to the Bureau of Safety and Environmental Enforcement, even as some operators began returning crews to offshore platforms.
In December 2016, at a meeting of oil producers in Vienna, 11 non-OPEC member countries, including Azerbaijan, agreed to cut oil production by a total of 558,000 barrels a day.