Oil prices have steadied with a drop in dollar prices, lessening the impact of amassing crude inventories.

US crude futures are trading below $50 a barrel due to rising stockpiles in the country.

Brent crude increased 9 cents at $56.19 a barrel, while the US September crude futures rose 18 cents at $49.37, Reuters reported.

"There is nothing really that could stop this contract from falling down to $53.19."

The dollar witnessed a loss though it remained near a three-month high, making it profitable for non-US investors to sell oil or gold that are dollar-denominated assets.

Data from the Energy Information Administration (EIA) revealed a 2.5 million increased US crude oil inventories last week, putting pressure on oil.

Oil prices are already under pressure as additional supply is set to enter into an oversupplied market following an Iranian nuclear agreement with the West.

PVM energy analyst Tamas Varga told the news agency: "A close below ($55.60 for Brent) is a sell and, in that case, there is nothing really that could stop this contract from falling down to $53.19, the daily low in the August contract on 13 January."

OPEC countries however believe that the recent decline in oil prices is likely to be short-term and they will keep the export high to protect their market share, which has been the strategy of the oil cartel in recent months.