Ejiofor Alike with agency reports
Crude oil prices slipped yesterday as United States production hit a record high, while the Organisation of Petroleum Exporting Countries (OPEC) considered boosting supply.
Global benchmark, Brent crude oil lost $1.26 a barrel, or 1.6 per cent, reaching a low of $75.53 before recovering to $76.29, down 50 cents.
US light crude was unchanged at 65.81 a barrel.
However, the U.S. contract lost about three per cent last week after a decline of nearly five per cent the previous week. US crude production climbed in March to 10.47 million barrels per day (bpd), a monthly record, data from the Energy Information Administration showed last week.
Reuters reported that US drillers added two oil rigs in the week to June 1, bringing the total to 861, the most since March 2015, energy services company, Baker Hughes said on Friday.
That was the eighth time drillers have added rigs in the past nine weeks.
Arab oil ministers agreed over the weekend on the need for continued cooperation between members of the Organization of the Petroleum Exporting Countries (OPEC) and other big producers to balance global supply, Kuwaitâ€™s state news agency KUNA reported on Sunday.
OPEC ministers from Saudi Arabia, the United Arab Emirates, Kuwait and Algeria, along with their counterpart from non-OPEC Oman, met unofficially in Kuwait on Saturday.
OPEC had on November 27, 2015, decided to pump as much as it could to defend market share, an action that sent the price of oil to a low of $27 per barrel in February 2016.
But following the drop in oil price to an all-time low, OPEC and other major producers including Russia started to withhold output in 2017 to rein in oversupply that had depressed prices since 2014.
OPECâ€™s main objective for the cuts is to eliminate a global surplus in oil stocks and re-balance the market.
OPEC, together with Russia and a group of other producers, last November extended an output-cutting deal to cover all of 2018.
The initial deal, under which OPEC and non-OPEC producers are cutting supply by about 1.8 million barrels per day, had expired in March 2018.
The production-cutting pact between the OPEC, Russia and other producers has given strong tailwind to oil prices
OPEC meets formally on June 22 and it is expected to agree to raise output to cool the market amid worries over Iranian and Venezuelan supply and after Washington raised concerns that the oil rally was going too far.
Saudi Arabia, the effective OPEC leader, and Russia have discussed boosting output to compensate for supply losses from Venezuela and to address concerns about the impact of U.S. sanctions on Iranian output.
Russiaâ€™s largest oil producer, Rosneft, will be able to restore 70,000 bpd of oil output in only two days if global production limits are lifted, Renaissance Capital wrote in a client note.