JPMorgan cut its oil price forecasts for this year and 2024 as it sees global supply growth offsetting a record rise in demand, while inventory build-up lowers the risk of price spikes.

The Wall Street bank revised its average Brent price forecast for 2023 to $81 per barrel from $90 earlier, and for West Texas Intermediate (WTI) to $76 a barrel from $84 previously.

It also lowered its 2024 price forecasts for Brent to $83 per barrel from $98, and for WTI to $79 a barrel from $94 earlier.

Brent futures were trading around $75 a barrel by 0916 GMT on Wednesday, while WTI U.S. crude was around $70 per barrel.

JPMorgan sees global oil supply growing by 2.2 million barrels per day (bpd) in 2023, surpassing projected demand growth of 1.6 million bpd.

"It is becoming increasingly clear that high oil prices over the past two years did exactly what they are supposed to do — incentivize supply," JPMorgan said in a note.

The world could consume a record-setting 101.4 million bpd of oil this year, led by unprecedented demand in China, India, and the Middle East, it said.

U.S. producers are leading the supply surge, with non-OPEC supply keeping up with global demand since 2022 and leaving OPEC+ - which comprises OPEC and other major producers such as Russia - to cut output, it added.

While its outlook in November saw the OPEC+ alliance succeeding in balancing oil markets, analysts at JPMorgan no longer believe that to be the case.

"Even with OPEC's existing 1.16 mbd (million bpd) voluntary cuts extended into 2024, we still project a 0.4 mbd surplus next year," they said.

Earlier this month, Saudi Arabia said it will make a deep cut to its output in July on top of a broader OPEC+ deal to limit supply into 2024 as the group seeks to boost flagging oil prices.

(Reporting by Deep Vakil in Bengaluru; Editing by Jan Harvey)