The crude oil prices are falling because of fears that rising U.S. production could lead to even larger volumes of stocks.
USA crude oil production soared past 10 million barrels per day (bpd) in late 2017, overtaking output by top exporter Saudi Arabia. Gross short positions on the New York Mercantile Exchange climbed to their highest in almost a month.
Brent crude futures were at $65.38 per barrel, down 11 cents, or 0.2 per cent, from their previous close.
Both WTI and Brent as recently as Thursday had marked their lowest settlements since mid-February. In February, even Saudi Arabia's state oil company considered participating in these flows via a us unit, before determining it wasn't economically viable at the time. The news is not likely to change the outlook for rising US production which is now up to 10.37 million barrels per day (bpd).
OPEC has been reducing output by around 1.2 million barrels per day (bpd) since January 2017.
"Oil prices fell on the back of concerns that surging USA production ... could push inventories in the US higher", ANZ bank said on Tuesday.
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The Organization of the Petroleum Exporting Countries (OPEC), together with a group of other producers led by Russian Federation, has been withholding production since the start of 2017 to prop up prices.
While US news has been dominated by the aluminum and steel tariffs proposed by President Donald Trump, the oil markets will not sustain significant price reactions, Poulsen said.
The news is expected to be light on Monday so most traders expect the price action to be driven by the U.S. Dollar and appetite for risk.
On Friday, Baker Hughes (BHGE) said that the number of active USA rigs drilling for oil (http://www.marketwatch.com/story/baker-hughes-reports-first-fall-in-us-oil-rig-count-in-7-weeks-2018-03-09) fell by four to 796 this week.
Meanwhile, data out Friday did show that hedge funds and money managers cut their bullish bets on US crude oil for the first time in three weeks.
Bijan Zanganeh, oil minister for Iran, said over the weekend that OPEC could agree in June to begin easing current oil production curbs in 2019; however, he added that working with the cartel to thwart the Americans is vital because "If the price jumps [to] around $70 .it will motivate more production in shale oil in the United States".