Oil Prices Extend Pullback as Focus Shifts to U.S. Supply Data

Investing.com – Crude prices fell on Tuesday, extending losses into a second session, 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 at 4:30PM ET (2130GMT) Tuesday. Official data from the Energy Information Administration will be released Wednesday, amid forecasts for an oil-stock gain of around , which would mark the first increase following ten straight weeks of declines.

U.S. West Texas Intermediate (WTI) slumped 75 cents, or 1.2%, to $64.78 a barrel by 3:35AM ET (0835GMT), its lowest level in around a week. On Monday, the U.S. benchmark fell 58 cents, or 0.9%, to $65.56 a barrel.

Meanwhile, futures, the benchmark for oil prices outside the U.S., declined 67 cents, or roughly 1%, to $68.53 a barrel, after losing 95 cents, or 1.4%, a day earlier.

Oil prices , pulling further away from their strongest levels since late 2014, as traders weighed a steady increase in U.S. output against OPEC’s ongoing efforts to drain the market of excess supplies.

Analysts and traders have recently warned that U.S. shale oil producers could ramp up production as they look to take advantage of higher prices, potentially derailing OPEC’s effort to curb excess supply.

The number of oil drilling rigs climbed by 12 to 759 last week, marking the biggest weekly increase in the rig count since March.

Domestic U.S. output has rebounded by almost 17% 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.

U.S. oil production rose to 9.87 million barrels per day last week, the highest level since the early 1970s and close to the output of top producers Russia and Saudi Arabia.

Oil prices have risen almost 55% from around $43 a barrel in June, benefiting from production cut efforts led by the Organization of the Petroleum Exporting Countries and Russia. The producers agreed in December to extend current oil output cuts 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.

In other energy trading, dropped 1.1% to $1.898 a gallon, while shed 1% to $2.076 a gallon.

jumped 5.0 cents, or 1.5%, to $3.215 per million British thermal units, on bets of cold weather to come in February.

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