The Organization of Petroleum Exporting Countries (OPEC) predicted that the global oil market is likely to stabilize around the second half of 2016, keeping forecast unchanged for the demand and supply of the energy component. The supply glut is expected to erode off as outages in Nigeria and Canada have weighed on prices quicker than expected.

The OPEC kept estimates for world supply and demand in 2016 unchanged in its monthly market report. Disruptions in Nigeria reduced the group’s output to 32.36 million barrels a day last month, a little below the 32.6 million averages required to satisfy estimated demand in the second half.

"The expected improvement in global economic conditions should result in a more balanced oil market toward the end of the year. The excess supply in the market is likely to ease over the coming quarters," said OPEC’s Vienna-based research department.

OPEC's report points to excess supply of 160,000 bpd in the second half of 2016 if the group keeps pumping at May's rate. Further, the OPEC mentioned that excess supply in the first quarter stood at 2.59 million bpd.

However, the organization did not set any output goal at its June 2 meeting when all 13 nations had met to discuss on the oil future. OPEC members stuck with Saudi Arabia’s strategy of pumping without limits to squeeze rival producers.

Meanwhile, non-OPEC producers, such as those in the US have had to dramatically cut back on oil production amid the price drop and OPEC chose to defend its market share rather than oil price.