Oil prices have declined due to a rise in supply amid record US exports, and markets have gained support on expectations that the US and China would soon reach an agreement.
International Brent crude oil futures decreased by 0.3% at $66.94 a barrel, while US West Texas Intermediate (WTI) crude futures dropped by 0.2% at $57.15 a barrel, Reuters reported.
Traders said that the reduction in prices was due to ample oil supply amid surging US exports. Other producers, especially in the Middle East, were forced to start offering their crude at discounts.
This month, US exports hit a record 3.6 million barrels per day (Mbpd). Crude oil production also hit a record 12Mbpd, representing an increase of more than 2Mbpd since early last year.
Under pressure from US supply growth, Abu Dhabi’s Murban crude has sold at a discount in Asia to its official selling price for four straight months.
The growth in US crude output counters the efforts led by the Organisation of the Petroleum Exporting Countries (OPEC) to reduce output and increase prices.
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Last week, oil prices received some support due to the OPEC cuts, as well as sanctions imposed by the US against Iran and Venezuela.
US President Donald Trump said that he would delay an increase in tariffs on Chinese goods.
If progress continued, Trump and Chinese President Xi Jinping would meet to seal an agreement.
US bank Goldman Sachs was quoted by the news agency as saying: “Long-dated oil prices will likely remain under pressure below $60 per barrel Brent and $55 per barrel WTI.”