Nasdaq reports in its article Oil holds above November lows but under threat from USA supply that investors in US crude futures and options increased their bets against a further rise in prices, as the number of US oil rigs in operation hit its highest in over three years.
WTI for August delivery climbed as much as 59 U.S. cents to US$43.60 a barrel on the New York Mercantile Exchange, and was at US$43.47 at 1.58pm in Hong Kong.
Brent crude futures were up 50 cents, or 1.1 per cent, at $46.04 per barrel at 0215 GMT.
He went on to note that one reason are signs of USA shale production starting to slow, "particularly in the past couple of weeks" and that an inventory drop began sooner than expected.
The price of oil has fallen as concerns over a global supply glut have yet to subside, and OPEC-led production cuts have had relatively little impact.
In May, OPEC and some non-OPEC producers extended a deal to cut 1.8 million barrels per day in supply until March 2018.
Despite the cuts, which started in January, markets remain well supplied due to rising output elsewhere.
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OPEC members Nigeria and Libya are exempt from the cuts and have raised production substantially.
On the other hand, based on research, oil prices have always been volatile and bearish markets are very common since 1985 oil has been in a bear market, more than 20 percent down its 52-week track gain and above one third of the time.
Analyst Merrill Lynch said that the demand had not grown enough to take in the excess output. Shale drillers added oil rigs for a record 23rd straight week as a growing backlog of unfinished wells - and the crude that will eventually flow from those projects - threatens to add to the global glut.
Libya's oil production stands at about 935,000 barrels per day (bpd) this week after touching as high as 950,000 bpd last week, Libyan oil sources said.
NEW YORK: Oil prices settled more than half a percent higher on Monday as some traders found bargains after last week's seven-month lows, but rising crude supply in the United States and other countries limited gains. The contract added 29 cents, or 0.6 percent, to $45.83 on Monday. The benchmark was still set to end the first half of the year down almost 20 percent.
OPEC delegates said the cartel will not rush into making a further cut in output or end some countries' exemptions from output limits, although a meeting in Russian Federation next month is likely to consider further steps.
"On a speculative basis it's arguably worth going long here and playing for a bounce", Kilduff said.