Investing.com – Oil prices pulled back from three-month highs on Wednesday as the focus in oil markets shifted to surging U.S. crude production and investors awaited the latest data on weekly U.S. inventories.
New York-traded fell 26 cents, or 0.46%, at $56.19 a barrel by 7:36 AM ET (12:36 GMT), after touching $56.77 earlier, its best level since November of last year.
Meanwhile, , the benchmark for oil prices outside the U.S., traded down 36 cents, or 0.54%, to $66.09, backing off of $68.83 reached on Monday which was also its best level since last November.
U.S. crude output, which soared by more than 2 million barrels per day (bpd) in 2018 to a record 11.9 million bpd, is set to keep rising thanks to booming shale oil production, the Energy Information Administration (EIA) said on Tuesday.
“Shale oil is setting new production records, threatening the Organization of the Petroleum Exporting Countries with another showdown that could upend the market as U.S. crude prices cross $55 per barrel,” Investing.com analyst warned.
BNP Paribas shared a similar view, suggesting that surging U.S. output would feed into lower oil prices toward the end of the year.
“U.S. oil production growth, driven by shale, will be increasingly exported in greater volumes to international markets while the global economy is expected to witness a synchronized slowdown in growth,” the bank said.
Amid concerns over market rebalancing, attention is set to turn to weekly data on U.S. crude inventories.
The American Petroleum Institute will release its later on Wednesday with out a day later amid expectations for a build of 3.1 million barrels.
Thursday’s report from the EIA will also include the latest reading on U.S. production.
Both reports come out one day later than normal due to Monday’s holiday.
In other energy trading, fell 0.24% to $1.5600 a gallon by 7:38 AM ET (12:38 GMT), while declined 0.40% to $1.9867 a gallon.
Lastly, rose 0.79% to $2.683 per million British thermal unit.
— Reuters contributed to this report.
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