Global oil prices dropped due to weaker demand outlook and a surprise increase in the US crude inventories.

Brent crude futures slipped $1.69 to $60.60 a barrel, while US West Texas Intermediate crude futures were down $1.56 to trade at $51.71 per barrel, reported Reuters.

The American Petroleum Institute (API) said that the US crude inventories increased by 4.9 million barrels to 482.8 million barrels last week, against analyst expectations of a drop of 481,000 barrels.

ANZ bank was quoted by Reuters as saying: “Investors have been concerned about the recent rise in stockpiles in the US.”

Trade tensions between the US and China also continued to weigh on the oil market. However, reports that the Organization of the Petroleum Exporting Countries (OPEC)-led supply-cuts will be extended halted the further decline in prices.

OPEC and other members including Russia have voluntarily restricted oil output by 1.2 million barrels per day to support the oil prices. The participants of the agreement are scheduled to meet later in June to discuss the future of the output policy.

Earlier, the United Arab Emirates energy minister Suhail bin Mohammed al-Mazroui told Reuters that the members are nearing an agreement to continue the supply cuts.

Goldman Sachs in a note said that the current situation with dim economic outlook and US sanctions of Iranian crude exports may lead OPEC to roll over production cut deal. On the other hand, the US Energy Information Administration (EIA) trimmed its earlier forecasts for 2019 world oil demand growth and crude production in the country.