Oil prices have decreased amidst signs of rising output as a result of increased drilling in the US.
US West Texas Intermediate (WTI) crude futures fell 20 cents, or 0.3%, to reach $62.14 a barrel, while Brent crude futures declined 22 cents, or 0.3%, to trade at $65.99 per barrel, according to Reuters.
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The drop in prices has wiped out gains made last Friday.
Traders are gripped with concerns of oversupply caused by the soaring output.
According to a drilling report released on Friday by Baker Hughes, US drillers added four oil rigs in the week ending 16 March.
With this, the total number of oil rigs reached 800.
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By GlobalDataBrokerage Phillip Futures was quoted by the news agency as saying: “Surging US production will hamper exponential growth in crude oil prices.”
The increase in rig count is a result of an increase in spending by US energy companies.
Since mid-2016, the US crude oil production has increased by more than 20% to 10.38 million barrels per day (bpd).
As per the forecast, the US is expected to overtake Russia in terms of production later this year.
Producers are divided on their output strategies the world over.
The Organisation of the Petroleum Exporting Countries (OPEC) and Russia have been taking measures since last year to arrest supply glut.
Meanwhile, Canada and Brazil are increasing production.
Despite Russia’s efforts to prop up prices, state-owned entity Rosneft’s liquid hydrocarbon production for fourth quarter last year stood at 56.51 million tonnes, which means an increase in the company’s full-year output by 7.3% to 225.5 million tonnes.
