Jefferies bank said it was lowering its oil price forecasts due to the strong rise in USA production, cutting its Brent price estimate for the second half of 2017 to $59/bbl from $61/bbl previously.
On the New York Mercantile Exchange crude futures for June delivery dipped 0.22% to $48.96 a barrel, while on London's Intercontinental Exchange, Brent was last quoted at $52.09 a barrel.
The relatively weaker oil prices, lower investment and cuts in International Oil Companies (IOCs') Capex led to a decline of 0.42 mbpd in non-OPEC output, particularly the U.S. oil production, which was partially balanced by higher OPEC crude oil output of 0.95 mbpd.
Jefferies analysts lowered their oil price forecasts due to the rise in USA production, cutting its Brent price estimate for the second half of 2017 to $59 per barrel from $61 previously.
A report from the International Energy Agency (IEA) on Wednesday, however, warned that OPEC's effort to rein in the glut in supply may fail even if the oil group agrees to extend its supply-cut agreement.
That defied expectations of analysts who estimated a draw in the stockpiles of 2.4 MMbbl, according to a Reuters survey.
The Organization of Oil Exporting Countries (OPEC) and other key producers will gather in Vienna on May 25 to decide whether to extend output cuts of 1.8 million bpd that started in the first half of 2017.More news: G-7 Echoes Watered-Down Trade Language as Mnuchin Holds Firm
Organisation of the Petroleum Exporting Countries (OPEC), continued to reduce production in April, but output from Africa's top exporter - Nigeria, increased by 273,600 barrels per day (bpd).
Kuwait, a Gulf producer usually aligned with the Saudi Opec view, said on Tuesday it supported the proposal.
This adds to a relentless rise in USA production, which has jumped by more than 10 percent since mid-2016 to 9.3 million bpd, not far off top producers Russian Federation and Saudi Arabia.
Having seen a almost two-week short-covering rally bring prices in WTI and Brent crude oil back about 50% of their last sell-off, it's now up to OPEC and non-OPEC members to agree to a further extension of the deal to cut production at the cartel's May 25 meeting to bring in new buyers to sustain the rally.
Jefferies bank said it was lowering its oil price forecasts due to the strong rise in United States production, cutting its Brent price estimate for the second half of 2017 to US$59 per barrel from US$61 previously.
Trade sources and Reuters shipping data indicated a rising number of tankers storing oil offshore China because facilities on land are full.
North Sea oil output, generally seen in terminal decline, is expected to jump by a net 400 Mbbl/d in the next two years with new projects and greater efficiencies.