Investing.com – Crude oil prices remained lower on Monday, as concerns that rising U.S. shale output could dampen efforts to lower global oil supplies continued to weigh.
The U.S. West Texas Intermediate crude January contract was down 63 cents or about 1.08% at $57.73 a barrel by 09:50 a.m. ET (13:50 GMT).
Elsewhere, Brent oil for February delivery on the ICE Futures Exchange in London was down 79 cents or about 1.22% at $62.94 a barrel.
Prices moved lower following news U.S. energy companies added two oil rigs in the week to Dec. 1, bringing the total count up to 749, the highest since September, General Electric (NYSE:GE)’s Baker Hughes energy services firm said in its closely followed report on Friday.
Domestic U.S. output has rebounded by almost 15% since the most recent low in mid-2016, and increasing drilling activity for new production means output is expected to grow further, as producers are attracted by climbing prices.
Prices had climbed after the Organization of Petroleum Exporting Countries (OPEC), along with some non-OPEC producers led by Russia, agreed last week to extend current oil output cuts for a further nine months until the end of 2018. They also signaled a possible early exit from the deal should the market overheat and prices rise too far.
The deal to cut oil output by 1.8 million barrels a day (bpd) was adopted last winter by OPEC, Russia and nine other global producers. The agreement was due to end in March 2018, having already been extended once.
The OPEC-led production cuts have been one of the key catalyst supporting the recent rally in oil prices amid expectations that rebalancing in crude markets are well underway.
However, fears that rising U.S. output would dampen OPEC’s efforts to rid the market of excess supplies are prevented prices from rising much further, according to market participants.
Elsewhere, gasoline futures were down 1.59% at $1.711 a gallon, while natural gas futures lost 1.47% to $3.016 per million British thermal units.