The market also lost the previous day’s upward momentum as speculation fizzled that the Organization of the Petroleum Exporting Countries and other oil producers would embark on another round of talks on price co-operation after their failed effort in April.
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The US Energy Information Administration will issue official inventory data on Wednesday. “Current oil price strength does not feel justified”.
Brent crude, the global benchmark, fell 0.79 per cent to $45.03 per barrel this morning.
Total U.S. crude inventories wer expected to fall by 1 million barrels in weekly reports, although market intelligence firm Genscape has reported a rise of more than 307,000 barrels at the Cushing, Okla., U.S. crude delivery hub, traders said.
“We expect a steady to higher opening as oil prices come back into the spotlight, said Peter Cardillo, chief market economist at First Standard Financial in NY”.
Qatar’s energy minister and Opec President, Mohammad bin Saleh al-Sada, said yesterday that the cartel was in continuous talks to stabilise the market.
“The call for a September OPEC meeting to freeze production is likely to send prices back within.$42.50-$45.50”, said Peter Cardillo, chief market economist at First Standard Financial, in a note. The global benchmark fell almost 15% in July.
The American Petroleum Institute (API) will issue its own report on USA petroleum stockpiles after Tuesday’s market settlement, at 4:30pm EDT (8:30pm GMT).
Last week, USA drillers added oil rigs for a sixth consecutive week, according to a Baker Hughes report, as producers continued boosting spending on expectations for higher prices in the future.
If accurate, this would be a vindication of its strategy since 2014 of squeezing non-OPEC suppliers by keeping production at high levels despite low prices.
WTI, or the West Texas Intermediate benchmark for USA crude, settled down US25 cents, or 0.6 per cent, at $US42.77 a barrel.
The minister assured that OPEC continues to monitor developments closely, and is in constant deliberations with all member states on ways and means to help restore stability and order to the oil market.
Some OPEC delegates said they don’t expect a decision or recommendation to be made during the side meetings in Algeria.
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A survey from its 14 members by S&P Global Platts found net production of 33.1 million barrels per day was a 1.2 percent increase from June and the highest level at least since February, a month that saw crude oil prices drop below $30 per barrel.
