Investing.com - Oil prices declined during North American morning hours on Wednesday, pulling back from the prior session's gains amid speculation weekly supply data due later in the session will show U.S. crude inventories rose for the third week in a row last week.
Crude oil for March delivery on the New York Mercantile Exchange shed 45 cents, or nearly 0.9%, to $52.73 a barrel by 8:30AM ET (13:30GMT), after rising 43 cents, or 0.85, a day earlier.
Elsewhere, Brent oil for March delivery on the ICE Futures Exchange in London dipped 49 cents, or about 0.9%, to $54.95 a barrel. The international benchmark gained 21 cents, or around 0.4%, on Tuesday.
The U.S. Energy Information Administration will release its weekly report on oil supplies at 10:30AM ET (15:30GMT) Wednesday, amid analyst expectations for a rise of 2.8 million barrels.
Gasoline inventories are expected to rise by 498,000 barrels while stocks of distillates, which include heating oil and diesel, are forecast to fall by 970,000 barrels.
After markets closed Tuesday, the American Petroleum Institute said that U.S. oil inventories rose by 2.9 million barrels in the week ended January 20.
The API report also showed a gain of 4.8 million barrels in gasoline stocks, while distillate stocks rose 2.0 million barrels.
Futures have been trading in a narrow range around the low-to-mid $50s over the past month as sentiment in oil markets has been torn between expectations of a rebound in U.S. shale production and hopes that oversupply may be curbed by output cuts announced by major global producers.
According to oilfield services provider Baker Hughes, the number of rigs drilling for oil in the U.S. last week jumped by 29 to 551, the biggest one-week increase in nearly four years.
U.S. drilling activity has risen by more than 6% since mid-2016, taking it back to levels seen in late 2014, when strong U.S. crude output contributed to a collapse in oil prices.
The data raised concerns that the ongoing rebound in U.S. shale production could derail efforts by other major producers to rebalance global oil supply and demand.
OPEC and non-OPEC countries have made a strong start to lowering their oil output under the first such pact in more than a decade, energy ministers said over the weekend as producers look to reduce oversupply and support prices.
Ministers said that 1.5 million barrels a day of the roughly 1.8 million in cuts pledged by OPEC and non-OPEC countries have already been taken out of the market.
January 1 marked the official start of the deal agreed by OPEC and non-OPEC member countries such as Russia in November last year to reduce output by almost 1.8 million barrels per day to 32.5 million for the next six months.
The deal, if carried out as planned, should reduce global supply by about 2%.
Elsewhere on Nymex, gasoline futures for February ticked down 1.4 cents, or 0.9% to $1.543 a gallon, while February heating oil slumped 2.5 cents, or 1.6%, to $1.616 a gallon.
Natural gas futures for March delivery rose 0.6 cents, or about 0.2%, to $3.301 per million British thermal units.