Investing.com - Oil prices declined during European morning hours on Tuesday, extending losses from the prior session amid concerns that rising output from the U.S. could derail efforts by other major producers to rebalance the market.
Crude oil for March delivery on the New York Mercantile Exchange fell to a session low of $52.24 a barrel, the weakest since January 23.
It was last at $52.36 by 4:15AM ET (09:15GMT), down 29 cents, or 0.55%, after losing 54 cents, or around 1%, a day earlier.
Elsewhere, Brent oil for April delivery on the ICE Futures Exchange in London declined 27 cents, or about 0.5%, to $55.05 a barrel. Futures slumped 38 cents, or nearly 0.7%, on Monday.
Oil prices were on track to end January with a loss of about 4% as sentiment has been torn between expectations of a rebound in U.S. shale production and hopes that oversupply may be curbed by output cuts announced by major global producers.
U.S. drilling activity has risen by more than 6% since mid-2016, taking it back to levels seen in late 2014, when strong U.S. crude output contributed to a collapse in oil prices.
The revival in U.S. drilling has raised concerns that the ongoing rebound in U.S. shale production could derail efforts by other major producers to rebalance global oil supply and demand.
OPEC and non-OPEC countries have made a strong start to lowering their oil output under the first such pact in more than a decade as global producers look to reduce oversupply and support prices.
January 1 marked the official start of the deal agreed by OPEC and non-OPEC member countries such as Russia in November last year to reduce output by almost 1.8 million barrels per day to 32.5 million for the next six months.
The deal, if carried out as planned, should reduce global supply by about 2%.
Elsewhere on Nymex, gasoline futures for March was little changed at $1.532 a gallon, while March heating oil dipped 0.7 cents, or 0.4%, to $1.617 a gallon.
Natural gas futures for March delivery slumped 4.8 cents, or 1.5%, to $3.184 per million British thermal units.