On the supply side, Libyan officials said oil export terminals that have been shut since 2014 could open again soon, potentially restoring 600,000 barrels per day of crude export capacity.
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Oil gained support for the first six months of 2016 from different signs that the glut in supply that halved the prices of oil during the past two years was easing and from outages that were unplanned in both Nigeria and Canada.
The American Petroleum Institute estimated that in the second quarter, the number of completed US oil wells – those that drillers had finished making and were ready to produce oil or gas – plunged by 69 per cent in the second quarter compared with a year earlier.
USA crude traded at $45.96 a barrel, down 64 cents or 1.4 per cent.
Crude prices extended gains on Monday in Asia, supported by comments from the Saudi energy minister saying the oil market is heading toward balance. U.S. markets are closed on Monday for the U.S. Independence Day holiday.
Traders said that indicated sentiment shift in a market that has traded not far from the psychologically bullish $50 a barrel level since mid-May despite mixed data on crude.
NYMEX crude for August delivery CLc1 was up 5 cents at $49.04 a barrel, after closing up 66 cents, or 1.4 percent, on Friday.
“There’s no doubt it was a disappointing number based off the comparison of what people were looking for”, said Phil Flynn, analyst at Price Futures Group in Chicago.
The CBOE volatility index, a gauge of options premiums based on moves in the USA oil exchange traded fund, jumped to its highest level in more than four months.
In Nigeria, violent attacks on the oil infrastructure knocked out some 600,000 barrels of daily oil production to around 1.25 million barrels per day (bpd) between January and mid-June.
It reported that the average USA retail gasoline price fell by 1.3% week-over-week and settled at $2.32 per gallon for the week ending June 27.
Brent crude traded near $50 a barrel as Nigerian militants claimed fresh attacks over the weekend, threatening to deepen the country’s biggest output losses in decades. Gasoline futures hit a 3-month low, sliding 1.5 per cent to around $1.46 a gallon.
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Although gasoline demand has remained close to record levels, but stocks have also continued to increase with over-production at refineries also an important influence.
