Investing.com – Crude oil prices settled lower on Tuesday, as investors appeared to take profit on the recent rally that has seen oil prices hit multi-month highs ahead of weekly inventory data due Wednesday expected to show crude oil supplies rose for the fourth-straight week.
On the New York Mercantile Exchange crude futures for November delivery fell by 34 cents to settle at $51.88 a barrel, while on London's Intercontinental Exchange, Brent lost 79 cents to trade at $58.23 a barrel.
A day after crude oil prices jumped to a four-month high following a threat from Turkey’s president to cut off oil exports from a Kurdish region of Iraq, traders appeared to unwind some of their bullish bets on crude oil futures ahead of a fresh batch of U.S. crude inventory data.
Turkey’s President Recep Tayyip Erdoğan on Monday warned his country could “close the valves” on the pipeline that carries 500,000-600,000 barrels of crude per day from northern Iraq to the Turkish port of Ceyhan.
The potential supply disruption, however, was weighed against expectations of an uptick in U.S. output, as disruptions to U.S. refinery activity due to storm Harvey continues to pressure demand for crude oil, adding to excess supplies.
“… we’re starting to see a correction in price as investors start to take profits at the highs,” said Adrienne Murphy, chief market analyst at AvaTrade. And “the efforts of OPEC and its allies may be futile, given the robust growth of the U.S. shale industry.”
U.S. crude inventory data from the American Petroleum Institute on Tuesday as well as a further report from EIA on Wednesday are expected to show an increase in U.S. crude inventories for the fourth-straight week.
The Energy Information Agency said U.S. shale production is set to rise for the tenth straight month in October as the recent uptick in U.S. oil prices - above $50 a barrel - spurred drilling activity.