Oil futures inch lower after Monday’s strong gains

Investing.com – Crude oil futures gave back some of the previous session's strong gains on Tuesday, as ongoing worries over a global supply glut drove down prices.

for delivery in September on the New York Mercantile Exchange shed 23 cents, or 0.5%, to trade at $44.73 a barrel during European morning hours.

A day earlier, Nymex oil fell to an intraday low of $43.35, a level not seen since March 2009, before rallying sharply to close at $44.96, up $1.09, or 2.48%.

Market players looked ahead to fresh weekly information on U.S. stockpiles of crude and refined products to gauge the strength of demand in the world’s largest oil consumer.

The American Petroleum Institute will release its inventories report Tuesday, while Wednesday’s government report could show crude stockpiles fell by 1.6 million barrels in the week ended August 7.

New York-traded oil futures have been under heavy selling pressure in recent months as worries over high domestic U.S. oil production weighed.

According to industry research group Baker Hughes (NYSE:), the number of rigs drilling for oil in the U.S. increased by six last week to 670, the third straight weekly gain.

There are still about 60% fewer rigs working since a peak of 1,609 in October, though the pace of declines has slowed considerably in recent weeks, fueling concerns that U.S. shale production could rebound in the months ahead.

Elsewhere, on the ICE Futures Exchange in London, for October delivery dipped 16 cents, or 0.3%, to trade at $50.87 a barrel.

On Monday, Brent prices tumbled to $48.24, the weakest level since March 2009, before turning higher to end at $51.02, up $1.78, or 3.61%.

Global oil production is outpacing demand following a boom in U.S. shale oil production and after a decision by the Organization of Petroleum Exporting Countries last year not to cut production.

Meanwhile, the spread between the Brent and the WTI crude contracts stood at $6.14 a barrel, compared to $6.06 by close of trade on Monday.

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