LINED UP: An employee stands in front of oil barrels at Royal Dutch Shell’s lubricants-blending plant in the town of Torzhok, Russia. Picture: REUTERS
LINED UP: An employee stands in front of oil barrels at Royal Dutch Shell’s lubricants-blending plant in the town of Torzhok, Russia. Picture: REUTERS

London/Singapore — Brent oil slipped to about $71 a barrel on Tuesday, pressured by the expectation of higher US inventories and concern about Russia's willingness to stick with Opec-led supply cuts.

Analysts on average expect US crude stockpiles to have risen by 1.9-million barrels last week, the fourth straight increase. The first of this week's stockpile reports is due at 8.30am GMT from the American Petroleum Institute.

"We have already seen these inventories going higher in the last week's print," said Naeem Aslam, chief market analyst at TF Global Markets in London.

"The rising inventory data has raised many questions for investors — no one wants to see the oil glut again."

Brent crude, the global benchmark, was down 12 US cents at $71.06 a barrel at 8.01am GMT. US West Texas Intermediate (WTI) crude gained 6c to $63.46.

While Opec-led supply cuts have boosted Brent by more than 30% in 2019, gains have been limited by worries that slowing economic growth could weaken demand for fuel.

Oil also fell on Monday after comments from Russia raised concern the Opec-led supply-cutting pact may not be renewed. Russia and the producer group may decide to boost output to fight for market share with the US, TASS news agency сited finance minister Anton Siluanov as saying.

Opec and other producers including Russia, an alliance known as Opec+, have been cutting output since January 1. They will decide in June whether to continue the arrangement.

"There is a growing concern that Russia will not agree on extending production cuts and we could see them officially abandon it in the coming months," said Edward Moya, senior market analyst at Oanda.

Reuters