Oil prices slipped succumbing to rising US drilling activity and a steady supply from OPEC countries despite production cut deal.
Brent crude futures fell by $0.34 to $51.42 per barrel while US West Texas Intermediate (WTI) crude futures plummeted by $0.48 to reach $48.30 a barrel, reported Reuters.
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Baker Hughes reported that in the week leading up to 17 March, US shale companies added 14 oil rigs, increasing the number of operating rigs to 631, the most since September 2015.
The US oil output also increased to 9.1 million barrels per day (BPD) from 8.5 million BPD in June 2016.
AxiTrader chief market strategist Greg McKenna was quoted by the news agency as saying: “This unwinding of position is both a cause and reflection of the big fall in crude oil prices when the cracks in the OPEC / non-OPEC deal emerged and when it seems like it became evident shale oil is back and the new swing player.”
In a note to clients, AB Bernstein was quoted by Reuters as saying the reduction in OPEC production from the start of 2017 will start to show up between mid-March and mid-April, thereby improving crude prices.
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