Investing.com – Crude futures settled lower on Tuesday, as the rally in oil prices cooled, following reports that Opec increased output despite the group’s pact to curb production.
On the New York Mercantile Exchange crude futures for September delivery fell 2% cents to settle at $49.16 a barrel, while on London's Intercontinental Exchange, Brent lost 2.24% to trade at $51.54 a barrel.
Investors skepticism over Opec’s ability to tackle the glut in supply resurfaced Tuesday after survey data from Reuters showed an uptick in Opec production despite the group’s pledge to increase compliance with the deal to cut production.
A survey from Reuters showed output from the Organization of the Petroleum Exporting Countries rose by 90,000 barrels a day in July, to a 2017 high of 33 million barrels.
The bearish survey comes a day after crude prices settled above $50 a barrel, on the back of expectations that some members of the Opec and non-Opec nations will meet on Aug 7-9 in Abu Dhabi to discuss how to increase compliance.
In May, Opec and non-Opec members agreed to extend production cuts for a period of nine months until March, but stuck to production cuts of 1.8 million bpd agreed in November last year.
Meanwhile in the U.S., fresh inventory data from the American Petroleum Institute later Tuesday as well as a further report from EIA late Wednesday is expected to show continued tightening in U.S. crude stockpiles.
Analysts forecast crude inventories fell by 2.9m barrels in the week ended July 28, the fifth-straight week of declines.