Oil slides on prospect of rising US production

While the Opec signalled a drop in the global oil supply surplus this year

Oil prices fell to their lowest level in a week on Wednesday on expectations US producers would boost output, while the Organisation of the Petroleum Exporting Countries (Opec) signalled a drop in the global oil supply surplus this year as the producer group's output fell from a record high.

Brent futures were down 33 cents, or 0.6 per cent, at $55.14 a barrel by 11:49 am EST (1649 GMT), while US West Texas Intermediate (WTI) crude fell 40 cents, or 0.8 per cent, to $52.08. Both contracts were down over $1 earlier Wednesday, putting them at their lowest levels since January 11.

US shale production is set to snap a three-month decline in February, the US Energy Information Administration said on Tuesday, as energy firms boost drilling activity.

EIA projected oil production in the biggest US shale fields would rise by 40,750 barrels per day (bpd) to 4.748 million bpd in February.

"The petroleum markets have turned lower again in Wednesday trade amid talk that higher oil prices will translate into additional US shale-oil production as a counter-balance to Opec efforts to trim supply and reduce excess inventories," Tim Evans, Citi Futures' energy futures specialist, said in a note.

Reuters