Oil prices slipped from more than two-month highs on Tuesday as ample global supplies countered strong demand and forecasts of another drop in U.S. crude inventories.
U.S. inventory reports due on Tuesday and Wednesday are expected to show crude stocks fell by 2.9 million barrels last week, the fifth straight week of declines.
However, OPEC production rose in July, a Reuters survey found Monday, despite a deal to cut output. That has stayed some of the buyers that helped boost U.S. oil futures by more than 16 percent since the contract dropped below $43 a barrel in late June.
"Momentum indicators have us in overbought territory over the last few days, which is telling you is going to pull back somewhat," said Robert Yawger, director of energy futures at Mizuho Americas.