With lower spending on tap for the year, British energy company BP said the market could return to a healthy balance between supply and demand by year's end.

First out of the gates with a report in a first quarter that saw crude oil prices drop below $30 per barrel, BP said it was trimming its spending target toward the low end of its estimate between $17 billion and $19 billion for the year. The oil major said that forecast could be revised even lower if the oil economy remains weak.

Chief Financial Officer Brian Gilvary said the company was envisioning a price range for oil at between $50 and $55 per barrel as the tipping point for balance.

"Should prices remain low, we have the flexibility to adjust further within the financial framework," he said in a statement.

Crude oil prices have recovered from below $30 per barrel, but are still about 25 percent lower than at this point last year. Moody's Investors Service said it expects oil to reach $43 per barrel by 2018.

Crude oil prices are lower in part because global economic recovery has been too slow to compensate for the surplus of oil on the market. Data last week from the U.S. Energy Information Administration show domestic crude oil inventories increased 2.1 million barrels from the previous week, a reversal of historic declines for this period.

BP said its production for the first quarter was about 2.4 million barrels of oil equivalent per day, a 5.2 percent increase year-on-year. The company said it expected production to be lower for the second quarter because of production sharing agreements, seasonal turnaround and maintenance activity.

BP CEO Bob Dudley said he was anticipating the market would return to balance at some point in the near future.

"Market fundamentals continue to suggest that the combination of robust demand and weak supply growth will move global oil markets closer into balance by the end of the year," he said.