Investing.com - Crude oil futures declined for the fourth consecutive session on Wednesday, as negotiations between western diplomats and Iran over Tehran’s nuclear program extended beyond Tuesday's deadline.
On the ICE Futures Exchange in London, Brent oil for May delivery slumped 18 cents, or 0.34%, to trade at $54.93 a barrel during European morning hours after touching a session low of $54.71. A day earlier, Brent futures lost $1.18, or 2.1%, to close at $55.11.
Talks between Iran and six world powers over Tehran's nuclear program missed its deadline on Tuesday, but officials have agreed to continue talks in Switzerland for an extra day.
The west wants Iran to accept restrictions on its nuclear program in exchange for the removal of international sanctions.
Any sign of a deal between Iran and world powers could result in a flood of Iranian crude returning to an already oversupplied market.
Elsewhere, on the New York Mercantile Exchange, crude oil for May delivery hit an intraday low of $47.13 a barrel, before trading at $47.23, down 38 cents, or 0.79%. On Tuesday, Nymex oil futures dropped $1.08, or 2.22%, to settle at $47.60.
Market players looked ahead to fresh weekly information on U.S. stockpiles of crude and refined products later in the day.
Wednesday's government report was expected to show that U.S. crude oil stockpiles rose by 4.2 million barrels last week, while gasoline stockpiles were forecast to decline by 1.0 million barrels.
After markets closed Tuesday, the American Petroleum Institute, an industry group, said that U.S. crude inventories increased by 5.2 million barrels in the week ended March 27.
The report also showed that gasoline stockpiles fell by 4.1 million barrels, while distillate stocks rose by 18,000 barrels.
Total U.S. crude oil inventories stood at 458.5 million barrels as of last week, the most in at least 80 years, underling concerns over a supply glut.
Oil prices have fallen sharply in recent months as the Organization of Petroleum Exporting Countries resisted calls to cut output, while the U.S. pumped at the fastest pace in more than three decades, creating a glut in global supplies.
Meanwhile, the spread between the Brent and the WTI crude contracts stood at $7.70 a barrel, compared to $7.51 by close of trade on Tuesday.
Elsewhere, the U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.1% to 98.60 early on Wednesday.
Later in the day, the U.S. was to release the ADP nonfarm payrolls report, while the Institute of Supply Management was to release data on manufacturing activity.
Investors were also turning their attention to Friday’s U.S. employment report for February for further indications on the future path of monetary policy.
A strong U.S. nonfarm payrolls report was likely to add to speculation over when the Federal Reserve will begin to raise interest rates, while a weak number could weigh on the dollar by undermining the argument for an early rate hike.