The two crude global benchmarks rose between 20 and 25 percent in April, helped by a weaker dollar and bets that a supply glut would ease, following the June-to-January sell-off that halved prices from above $100 a barrel.
ut signs of an increasing supply glut are growing.
Iraq’s oil exports rose in April to a record 3.08 million barrels per day (bpd) from 2.98 mln bpd in the previous month, the oil ministry said on Friday.
The figure highlights a growing surplus in production from OPEC members, whose supply in April rose to its highest in more than two years to 31.04 million bpd.
Brent LCOc1 was down 48 cents at $66.30 a barrel by morning. It rose to a 2015 peak of $66.93 on Thursday and increased 21 percent in April.
U.S. crude CLc1 was down 8 cents at $59.55, after hitting a 2015 high of $59.85 in post-settlement trading on Thursday. It gained 25 percent last month.
Trading on Friday was thin with some major markets closed for the May Day holiday.
“What is driving prices these days is less physical markets which remain very weak but more expectations of future tightening,” said Amrita Sen, chief oil analyst at Energy Aspects.
Despite a sharp drop in new U.S. shale drilling in recent months, there have been few signs that a global supply glut is easing, and there are some signs that U.S. oil production may not fall significantly in the near future.
Futures and options trades suggest U.S shale producers are locking in production costs for next year, which could pave the way for a rebound in production.
“If markets don’t tighten as quickly as people are expecting, the sell-off can be large,” Sen said.