Investing.com - Oil prices were slightly lower in North American trade on Monday, as market players focused on an improving global supply outlook.
Trading volumes were likely to remain light with U.S. markets closed Monday for Memorial Day while the U.K. is also shuttered for a public holiday.
Expectations for an increase in Canadian oil sands production this week mounted as oil producer Suncor Energy announced plans to ramp up output at its fields in Alberta after it was forced to shut them down earlier in May due to massive wildfires.
Supply outages due to wildfires in Canada and unrest in Nigeria have helped push oil prices above the $50-level late last week. However, as some of the supply disruptions are subsiding, traders are putting their focus back on the growth of global oil supply.
According to reports, Iraq plans to ship 5 million extra barrels of crude in June. Saudi Arabia, Kuwait, Iran and the United Arab Emirates are also planning to increase supplies later this year.
Market players are now looking ahead to the Organization of Petroleum Exporting Countries meeting in Vienna on Thursday. Most market analysts expect the oil cartel to keep their production quota unchanged amid rising prices.
The oil cartel’s most recent meeting in Qatar in April ended without agreement to freeze output at current levels due to Saudi Arabia's insistence that Iran be part of the agreement.
On the ICE Futures Exchange in London, Brent oil for August delivery dipped 11 cents, or 0.22%, to trade at $49.84 a barrel by 12:40GMT, or 8:40AM ET.
Last Thursday, Brent prices jumped to $50.96, a level not seen since October 12, as unplanned supply disruptions in Africa and North America eased concerns over a global glut.
Brent futures prices are up by roughly 85% since briefly dropping below $30 a barrel in mid-February.
Elsewhere, crude oil for July delivery on the New York Mercantile Exchange shed 5 cents, or 0.1%, to trade at $49.28 a barrel.
Nymex prices rallied to $50.21 last Thursday, the most since October 9. U.S. crude futures are up nearly 80% since falling to 13-year lows at $26.05 on February 11 as a decline in U.S. shale production boosted sentiment.
According to oilfield services provider Baker Hughes, the number of rigs drilling for oil in the U.S. fell by two to 316 in the latest reporting week, keeping up a broad trend of declines.
Meanwhile, Brent's premium to the WTI crude contract stood at 56 cents a barrel, compared to a gap of 62 cents by close of trade on Friday.