The recent price decline is "a cause and effect of the increase in US shale drilling where weaker speculative longs remain quite fragile to global risk sentiment", Stephen Innes, head of trading for Asia at currency broker Oanda, told clients in a note Tuesday.
THE oil inventory trajectory anchors oil prices in the short term, and the cost of bringing on the marginal barrel of USA tight oil supply serves as the medium-term anchor for prices. Analysts had expected an increase of 2.5 million barrels.
Stimulated by yesterday's surprise crude stockpiles decline estimated by API, at 2.74 million barrels, WTI today traded at US$64.24 at the time of writing, with Brent crude at US$67.97 a barrel.
In gasoline, the EIA reported a 1.7-million-barrel inventory decline, on top of the 6.3-million-barrel fall reported for the previous week.
"There's an expectation that (Trump and Prince Mohammed) are going to take a harder line on Iran, and that's bringing prices up", said Phil Flynn, a senior energy analyst at Price Futures Group in Chicago.
Saudi Arabia called the 2015 nuclear deal between Iran and world powers a "flawed agreement" on Monday, on the eve of a meeting between the Saudi crown prince and U.S. President Donald Trump.
Afghanistan: Dozens killed celebrating Nawruz in attack claimed by IS
Afghanistan's Shiite population has repeatedly been targeted by IS affiliates, who view the minority group as apostates of Islam. The fatal blast killed 29 and wounded another 52 people, Ministry of Public Health spokesman Wahid Majroh revealed.
The country's February output was down by more than half a million barrels compared with a year ago, according to International Energy Agency data last week. Oil prices rose steeply last Friday after he said Saudi Arabia would develop nuclear weapons if Iran did.
Soaring US output, as well as rising output in Canada and Brazil, is undermining efforts by the Middle East dominated Organization of the Petroleum Exporting Countries (OPEC) to curb supplies and bolster prices.
Looking at USA crude oil stocks, the most recent EIA figures (March 4) showed rising crude oil stocks and falling gasoline inventories. Brent is the benchmark for several Middle East and other global crudes. On the New York Mercantile Exchange, West Texas Intermediate futures were trading up by 1% at $62.75 a barrel.
Heating oil futures rose 2.2 percent to finish at $1.9495 a gallon, their highest settle since late February.