Oil futures lose more than 1% amid rising OPEC supply

Investing.com - Oil futures were under pressure on Monday, amid indications OPEC producers are showing no sign of curtailing output.

Iraqi Oil Minister Adel Abdul Mahdi said on Sunday that his country was pumping at a record pace of 4 million barrels a day in December, underlining concerns over a glut in global supplies.

On the New York Mercantile Exchange, crude oil for delivery in March shed 79 cents, or 1.61%, to trade at $48.34 a barrel during U.S. morning hours.

Trade volumes were expected to remain light on Monday, with U.S. markets closed for a holiday.

On Friday, New York-traded oil futures surged $2.40, or 5.14%, to settle at $49.13 a barrel, as investors returned to the market to close out bets on lower prices.

WTI prices touched $44.20 on January 13, a level not seen since March 2009.

Elsewhere, on the ICE Futures Exchange in London, Brent oil for March delivery declined 71 cents, or 1.43%, to trade at $49.46 a barrel.

London-traded Brent prices rallied $1.90, or 3.94%, on Friday, to close at $50.17 a barrel. Brent hit $45.19 on January 13, the weakest level since April 2009.

Friday's gains came after International Energy Agency cut its forecast for the increase in non-OPEC oil supply this year by 350,000 barrels a day, amid indications lower prices had begun to curb output in some areas, including North America.

Industry research group Baker Hughes said Friday that the number of rigs drilling for oil in the U.S. fell by 55 last week to 1,366, the lowest since October 2013.

The number of oil rigs has declined in 11 of the last 14 weeks since hitting an all-time high of 1,609 in mid-October.

London-traded Brent prices have fallen nearly 60% since June, when it climbed near $116, while WTI futures are down almost 58% from a recent peak of $107.50 in June.

Concerns over weakening global demand combined with indications that the Organization of the Petroleum Exporting Countries will not cut output to support oil markets have weighed on prices in recent months.

At the same time, increasing supplies of crude oil from North American shale formations have helped create a glut in world markets.

Oil traders looked ahead to a raft of Chinese economic data due on Tuesday for further indications on the strength of the economy and the future path of monetary policy.

The Asian nation will release data on fourth quarter gross domestic product, as well as reports on industrial production, retail sales and fixed-asset investment for December.

Market analysts expect China's economy to grow 7.2% in the three months ending December 31, down from growth of 7.3% in the preceding quarter.

Recent economic data from the Asian nation has indicated that the recovery remains fragile and may require further monetary stimulus.

Meanwhile, the euro remained under pressure amid mounting expectations that the European Central Bank will launch a government bond-buying program at its meeting on Thursday, in a bid to stave off the threat of deflation in the euro area.

Last Thursday, the Swiss National Bank abandoned its three-year old 1.20 per euro exchange rate cap in a shock move, signaling that it expects the ECB to act this week.

The move roiled financial markets and saw the Swiss franc strengthen across the board.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, dipped 0.25% to 92.82.