Oil prices dipped on Tuesday as higher output in the United States, Canada and Libya outweighed lower production by Russia and major OPEC exporters ahead of the release of U.S. data expected to show a fourth consecutive decline in crude stocks.
Losses accelerated shortly before Tuesday's settlement. John Kilduff, founding partner at energy hedge fund Again Capital, pointed to a Bloomberg report that the Libyan prime minister and a rival commander had agreed to set up a power-sharing council.
That would compound concerns about the country's output after Libya's National Oil Co said on Monday that production had risen above 760,000 bpd to its highest since December 2014, and it plans to keep boosting production.
"We've got more output from Libya and the United States and there is no certainty OPEC will keep production cuts in place at their meeting in May," said Phil Davis, managing partner at PSW Investments in Woodland Park, New Jersey.
"Until OPEC removes the fear that they might not extend their production cuts, it will be hard for oil to get a bid," Davis said.