Investing.com - West Texas Intermediate oil futures retreated on Thursday, as ongoing worries over high domestic U.S. oil production, despite a declining rig count, weighed.
According to industry research group Baker Hughes (NYSE:BHI), the number of rigs drilling for oil in the U.S. fell by 4 last week to 631. The drop marks the 28th straight week of declines.
However, U.S. oil production has held around 9.6 million barrels a day, the highest level since the early 1970s.
On the New York Mercantile Exchange, crude oil for August delivery shed 42 cents, or 0.7%, to trade at $59.85 a barrel during U.S. morning hours.
A day earlier, Nymex oil lost 74 cents, or 1.21%, to end at $60.27 after data showed that U.S. motor gasoline inventories rose by 0.7 million barrels last week, while distillate stockpiles increased by 1.8 million barrels.
Energy traders have been paying close attention to gasoline stockpiles in recent weeks as the U.S. driving season entered its peak gasoline demand period.
Total crude oil inventories fell by 4.9 million barrels last week to 463.0 million, compared to expectations for a drop of 2.1 million barrels to 465.8 million.
Elsewhere, on the ICE Futures Exchange in London, Brent oil for August delivery inched down 21 cents, or 0.34%, to trade at $63.28 a barrel. On Wednesday, Brent futures dropped 96 cents, or 1.49%, to close at $63.49.
The spread between the Brent and the WTI crude contracts stood at $3.43 a barrel, compared to $3.22 by close of trade on Wednesday.
Meanwhile, investors nervously eyed developments in Greece’s debt talks ahead of the looming deadline for Greece to repay €1.6 billion to the International Monetary Fund on June 30.
If Greece misses the payment it risks going into default, which could trigger the country’s exit from the euro area.
Negotiations faltered on Wednesday after Greece’s creditors rejected some of its latest proposed reforms and presented the government with counter proposals for a deal to unlock bailout funds.
Discussions were expected to resume in Brussels on Thursday morning, ahead of a Eurogroup meeting of euro zone finance ministers scheduled later in the day.
In the U.S., the Commerce Department said in a report earlier that personal spending rose by 0.9% in May, the biggest gain since August 2009 and above expectations for a gain of 0.7%. Consumer spending is the single biggest source of U.S. economic growth, accounting for as much as two-thirds of economic activity.
A separate report showed that the number of people who filed for unemployment assistance in the U.S. last week rose last week, but remained in territory consistent with a strengthening labor market.
The U.S. Department of Labor said the number of individuals filing for initial jobless benefits increased by 3,000 last week to 271,000. Analysts had expected initial jobless claims to rise by 4,000 to 272,000 last week.
First-time jobless claims have held below the 300,000-level for 16 consecutive weeks, which is usually associated with a firming labor market.
The upbeat data boosted optimism over the health of the economy and supported the case for a U.S. interest rate hike this year.