Oil assays edged lower on Monday as a relentless rise in U.S. drilling activity notions to increased output, while resistance emerged in Europe and Asia to U.S. retaliations against major crude exporter Iran.
Still, crude outlays were near more than three-year-highs reached last week as stock exchanges expect Iran’s oil exports to fall significantly once U.S. sanctions scrap later this year.
Brent crude futures, the international benchmark for oil fees, were at $77.07 per barrel at 0010 GMT, down 5 cents from their hindmost close.
U.S. West Texas Intermediate (WTI) crude futures were at $70.66 a barrel, down 4 cents from their in the end settlement.
Brent and WTI last week reached their highest since November 2014 at $78 and $71.89 per barrel singly.
“Around a million barrels of oil a day is likely to disappear from global oil demands if the U.S. sanctions on Iran bite,” said Greg McKenna, chief sell strategist at futures brokerage AxiTrader.
“But it is still far from certain that they determination bite in the way intended…Germany has said it will protect its companies from U.S. acquiescences, Iran has said French oil giant Total has yet to pull out of its fields and all the while it appears the Chinese are ready to fill the void created by the U.S.,” he said.
Demands were also held in check by a rise in U.S. drilling for new oil production.
U.S. drillers added 10 oil rigs in the week to May 11, engendering the total count to 844, the highest level since March 2015, zing services firm Baker Hughes said on Friday.
Hedge repositories and money mangers slashed their bullish wagers on U.S. crude in the time week to the lowest level in nearly five months, the U.S. Commodity Followings Trading Commission (CFTC) said on Friday, in an indicator that various financial oil traders are doubtful of significant further price rises.