Investing.com - Crude prices extended their decline into a second session on Tuesday, as investors looked ahead to weekly data from the U.S. on stockpiles of crude and refined products to gauge the strength of demand in the world’s largest energy consumer.
Industry group the American Petroleum Institute is due to release its weekly report at 4:30PM ET (2130GMT) Tuesday. Official data from the Energy Information Administration will be released Wednesday, amid forecasts for an oil-stock drop of around 3.5 million barrels, which would mark the third-straight fall.
U.S. West Texas Intermediate (WTI) crude futures lost 24 cents, or about 0.4%, to $57.23 a barrel by 3:20AM ET (0820GMT), after slumping 1.5% a day earlier.
Meanwhile, Brent crude futures, the benchmark for oil prices outside the U.S., were at $62.22 a barrel, down 23 cents, or 0.4%, from their last close. The contract suffered a loss of 2% in the prior session.
Oil prices settled lower Monday amid worries that rising U.S. shale output would dampen OPEC’s efforts to rid the market of excess supplies.
Recent data showed that U.S. energy companies added two oil rigs in the week to Dec. 1, bringing the total count up to 749, the highest since September.
Domestic U.S. output has rebounded by almost 15% since the most recent low in mid-2016, and increasing drilling activity for new production means output is expected to grow further, as producers are attracted by climbing prices.
Losses were limited thanks to OPEC’s decision to extend its output cuts to the end of next year. The producer group, along with some non-OPEC members led by Russia, agreed last week to extend current oil output cuts for a further nine months until the end of 2018.
The deal to cut oil output by 1.8 million barrels a day (bpd) was adopted last winter by OPEC, Russia and nine other global producers. The agreement was due to end in March 2018, having already been extended once.
The OPEC-led production cuts have been one of the key catalyst supporting the recent rally in oil prices amid expectations that rebalancing in crude markets are well underway.
However, fears that rising U.S. output would dampen OPEC’s efforts to rid the market of excess supplies are prevented prices from rising much further, according to market participants.
In other energy trading, gasoline futures dipped 0.4 cents, or 0.3%, to $1.689 a gallon, while heating oil lost 0.6 cents to $1.887 a gallon.
Natural gas futures sank 2.7 cents, or 0.9%, to $2.958 per million British thermal units.