Crude oil prices took a gentle dip on Tuesday ahead of weekly data that is forecast to show a rise in United States crude inventories.
However, investors’ faith in OPEC’s ability to curtail production helped stemmed prices from a further slide.
Brent crude futures fell 26 cents to $67.24 a barrel by 1337 GMT, while U.S. West Texas Intermediate crude eased 32 cents to $63.59.
Stocks are forecast to have risen by 2.7 million barrels last week, according to a Reuters poll.
Inventories have fallen by more than 100 million barrels, or a quarter, in the last 12 months, to around their lowest in three years. Seasonally, stocks tend to build in the first three months of the year.
Soaring U.S. production is upending global oil markets at a time when other major producers – including Russia and the Middle East-dominated Organization of the Petroleum Exporting Countries – have been withholding output to prop up prices.
The United States will overtake Russia as the world’s biggest oil producer by 2019, International Energy Agency (IEA) Executive Director, Fatih Birol said on Tuesday.
“U.S. shale growth is very strong, the pace is very strong. The United States will become the No.1 oil producer sometime very soon,” Birol told Reuters.
U.S. output was 10.27 million barrels per day (bpd), according to government data released last Thursday. This is higher than the latest figures for Saudi Arabia, the world’s largest exporter, and just below Russia.
A steadier dollar also undermined the crude oil market, given the inverse relationship between the two, whereby a stronger U.S. currency can encourage investors to book profits on their holdings of dollar-priced commodities, stocks or bonds.
“Our technical analysts are saying (oil) is bearish unless we break above $67.70,” SEB Head of Commodity Strategy, Bjarne Schieldrop said.
“It’s been rejected exactly at that level … and that is where the price action is today. It’s at a level where it’s a tie between ‘back to bullish or back to bearish.”