Investing.com - Crude oil prices retreated from more than three-year highs as geopolitical tensions calmed, while concerns over continued U.S. oil expansion returned after U.S. oil rig counts jumped to a three-year high.
On the New York Mercantile Exchange crude futures for May delivery fell 1.74% to settle at $66.22 a barrel, while on London's Intercontinental Exchange, Brent fell 1.61% to trade at $71.41 a barrel.
Crude oil prices started the week on the back foot as traders appeared to rein in bullish bets on U.S.-led military intervention in Syria, sparking wider conflict in the region, potentially disrupting oil stockpiles.
Easing geopolitical tensions come as investors don’t expect any further occurrences of U.S. military action in Syria, expressing relief somewhat that the U.S. and Russia avoided any direct conflict in Syria following U.S.-led airstrikes on Saturday.
Crude prices had gained more than 8% last week as traders piled into oil futures, betting that rising geopolitical tensions in the Middle East would threaten supply disruptions, extending the rally in oil prices.
Geopolitical tensions had overshadowed data on Friday pointing to continued expansion in U.S. output.
Data from energy services firm Baker Hughes showed the number of oil rigs operating in the US rose by 7 to 815, the highest level in more the than three-years.
Losses in crude prices, however, were limited somewhat amid investor hopes that the OPEC-led deal to slash excess demand would be extended into 2019 at a meeting between oil-producing nations in June.
“There is growing confidence that the declaration of cooperation will be extended beyond 2018,” OPEC Secretary-General Mohammad Barkindo said last week.
Despite the weakness in crude oil prices Monday, data showed traders resumed their bullish bets on crude oil prices last week.
CFTC COT data showed money managers increased their net long positions in crude oil to 707,100 lots from 699,500 lots for the week ended April 10.