Investing.com – WTI crude oil prices settled sharply lower on Monday amid renewed fears that a ramp up in U.S. shale output could undermine major oil producers’ efforts to reduce global crude supplies.
On the New York Mercantile Exchange crude futures for April delivery fell $0.68 cents to settle at $61.36 a barrel, while on London's Intercontinental Exchange, Brent fell 0.78% to trade at $64.98 a barrel.
Ahead of the Energy Information Administration (EIA) forecast on oil production from seven major shale regions for the month of April slated for later Monday, investors grew nervous that the recent uptick crude prices above $60 has encouraged U.S. shale producers to ramp up output.
The ongoing uptick in U.S. shale output is widely expected to dampen OPEC and its allies’ efforts to bring global crude supplies down to the five-year average.
That offset recent positive data on oil output after baker Hughes reported the number of oil rigs operating in the U.S. fell by four to 796, according.
The negative turn in sentiment on oil prices was characterised by data Friday showing traders slashed their bullish bets on oil for the first time in two weeks following the EIA's report Wednesday that U.S. output jumped to a record high per day of nearly 10.4 million barrels.
Traders reduced their WTI net-long position – the difference between bets on a price increase and wagers on a drop – for the first time in two weeks in the period ended March 9, according to U.S. Commodity Futures Trading Commission data.