SINGAPORE (Reuters) – Oil prices fell by about 1 percent on Monday as drilling activity in the US, the world's largest oil producer, picked up and financial markets were pulled down by trade problems.
FILE PHOTO: An oil pump hunt pumps oil in a field near Calgary, Alberta, Canada July 21
A refining fire in the US state of Illinois, which resulted in the closure of a large Raw distillation unit, which can cause raw demand to fall also weighted on prices, traders said.
US .. The red futures of the West Texas Intermediate (WTI) were at $ 52.09 per barrel at 0347 GMT, down 63 cents, or 1.2 percent, from their recent settlement.
International Brent crude futures were down 49 cents, or 0.8 percent, at $ 61.61 per barrel.
In the US, last week's energy business increased the number of oil rigs operating for the second time in three weeks, a weekly report from Baker Hughes said on Friday.
The companies added seven oil rigs a week to February 8, raising a total of 854, pointing to a further increase in US crude production, already on record 11.9 million bpd.
The WTI prices were also weighed down by the closure of a 120,000 barrels per day (bpd) crude distillation unit (CDU) in Phillips 66s Wood River, Illinois, refinery after a Sunday fire.
Elsewhere, the head of Russian oil giant Rosneft, Igor Sechin, wrote to Russian President Vladimir Putin, who says Moscow's deal with the oil exporting countries OPEC (OPEC) to hold back production is a strategic threat and plays in the hands of the United States.
The so-called OPEC + agreement has been in place since 2017, with the aim of reining in a global supply overhang. It has been expanded several times, and in the end, the participants have reduced production by 1.2 million bpd until the end of June.
OPEC and its allies meet in Vienna on April 17 and 18 to review the pact.
Analysts said economic concerns also weighed on crude oil futures.
Vandana Hari from Vantaa Insights said in a note that crude prices were being pulled down "when China returned from a week-long month's holiday, and regional stock markets pushed into the red in the midst of resumed concerns over the US-China trade negotiations." 19659004] Trade talks between Washington and Beijing resume this week with a delegation of US officials traveling to China for the next round of negotiations. The US has threatened to increase tariffs already imposed on goods from China on March 1, if the trade negotiations do not produce an agreement.
Preventing crude prices from falling further has been US sanctions against Venezuela, targeting the state-owned oil company Petroleos de Venezeula SA (PDVSA).
"The problems in Venezuela continue to support the prices. Reports show that PDVSA distorts to secure new markets for crude oil, after the US has imposed further sanctions in the country," said the ANZ bank on Monday.
(GRAPHIC: US oil production and drilling levels – tmsnrtrs / 2Tm4u4I)
Reporting by Henning Gloystein; Editing by Joseph Radford and Christian Schmollinger