Investing.com - Crude prices dropped in early Asia on Tuesday with more than ample global supplies the focus and few near-tern demand triggers in sight.
On the New York Mercantile Exchange, WTI crude for September delivery fell 0.50% to $47.16 a barrel.
Overnight, U.S. crude futures extended a prolonged slump on Monday falling to fresh four-month lows, as energy traders continued to digest a considerable build in U.S. oil rigs last week.
On the Intercontinental Exchange (ICE), Brent crude for September delivery wavered between a low of 53.35 and a peak of 54.89, before settling at 53.52 a barrel, down 1.10 or 2.01%. The spread between the international and U.S. benchmarks of crude stood at $6.08, below Friday's level of $6.48 at the close of trading.
On Friday, oil services firm Baker Hughes (NYSE:NYSE:BHI) said in its weekly rig count that U.S. oil rigs last soared by 21 to 659. A week earlier, the rig count fell mildly by seven to 638. The minor decline was preceded by two weeks of builds, after 29 consecutive weeks of draws. The count is down sharply from its level last fall when it peaked above 1,500. Energy analysts, however, are placing less stock in the rig count in comparison with recent years, as U.S. shale producers find creative ways to drill efficiently while removing less effective rigs.
Crude futures have declined by more than 40% since Opec's controversial decision last November to keep its production ceiling above 30 million barrels per day. The strategy sent prices plummeting, amid a glut of oversupply on global markets.
Elsewhere, Libyan officials said Monday that crude output has dipped below 400,000 barrels per day as the effects of a bloody conflict has cut electric supply at a number of prominent oil fields throughout the country. Last month, Opec said in a monthly report that the Northern African country had produced 411,000 bpd during the month of June.
By comparison, Libya produced approximately 1.6 million bpd in the months before a coup that ousted the government of Muammar Gaddafi in 2011. Libya is currently the smallest producer of the 12 members of the world's largest cartel.