Oil prices have dropped marginally yet still remain at an almost eight-week high due to the sharp fall in US crude stocks that may decrease global crude oversupply.
Brent crude futures slipped by 9 cents to $50.88 a barrel following a rise of 1.5% in the earlier session, while the US West Texas Intermediate futures fell by 8 cents to $48.67 a barrel, reported Reuters.
Data released by the US Energy Information Administration (EIA) highlighted a fall in US crude inventory by 7.2 million barrels in the week ending 21 July, while analysts forecasted a drop of 2.6 million barrels.
The rise in production at the refineries along with the fall in imports resulted in a huge fall in US stocks.
EIA stated that gasoline stocks and distillate inventories also dropped.
PIRA Energy oil analyst Jenna Delaney was quoted by the news agency as saying: "This marks the fourth consecutive week that total hydrocarbon inventories have fallen during a time of year when they normally increase."
The market remained optimistic over Saudi Arabia’s decision to curb oil exports to 6.6 million barrels per day (bpd) next month.
Other key members of the OPEC such as Kuwait and United Arab Emirates later promised to reduce exports.
However, analysts suggested that oil prices may not improve further as the recent gains may encourage US shale producers to increase production.
Key US shale producers such as Hess Corp, Anadarko Petroleum, and Whiting Petroleum previously announced they would reduce spending this year due to persistent low oil prices.