Goldman Sachs Group Inc lowered its crude oil price forecasts for this year and next year on Friday, saying prices need to remain low enough to ensure supply is reduced over time, according to Reuters.

"We caution that a premature recovery in oil prices could curtail an oil supply correction, and prove self-defeating", the influential investment bank said in an equity research note to clients on Friday.

The bank said it expects Brent prices to average $39 a barrel in 2016 and $60 a barrel in 2017, down from its previous forecasts of $45 and $62 a barrel respectively.

Goldman also trimmed its 2016 West Texas Intermediate (WTI) price forecast by $7 to $38 a barrel, and its 2017 price forecast by $2 to $58 a barrel.

Predicting a slower recovery into next year and sharper oil production declines in 2016, the bank said it does not foresee production hitting previous peaks until mid-2018.

/By Azertac/