Oil futures pulled back from a two-week high Tuesday to settle modestly lower as traders weighed continued concerns about a global supply glut versus prospects for an agreement by major producers to curb output.
On the New York Mercantile Exchange, crude futures for delivery in September fell 25 cents, or 0.6%, to close at $42.77 a barrel. October Brent crude on London’s ICE Futures exchange lost 41 cents, or 0.9%, to settle at $44.94 a barrel.
Oil flipped between gains and losses in a choppy session, but were dragged lower around midday after the U.S. Energy Information Administration, in its monthly short-term energy outlook, said it expects U.S. crude oil production to decline to 8.73 million barrels a day in 2016 from 9.43 million barrels in 2015. In July, the agency had forecast 2016 production of 8.61 million barrels.
The change comes amid an uptick in the number of domestic rigs drilling for crude oil.
Futures, however, were locked in a relatively tight trading range ahead of weekly supply data, with some support attributed to a planned meeting of oil-producing nations in September despite skepticism over the prospects for curbing output.
Traders “continued to eye the possibility that [Organization of the Petroleum Exporting Countries] members may hold talks in September to consider production caps,” wrote strategists at Tradition Energy.
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