Feb. 6 (UPI) -- Number-crunching on the managed decline agreement from OPEC and a rise in North American drilling put pressure on oil prices early Monday.
Oilfield services company Baker Hughes reported a rise in North American exploration and production activity, a metric gauged by rig counts. A recovery in crude oil prices since the middle of last year has brought operators back to expensive basins in North America, shale oil in particular.
The U.S. rig count for the week ending Feb. 3 was up for its third week in a row and near its highest level since late 2015. Rig activity would lag behind real production figures, though Baker Hughes data counters efforts from the Organization of Petroleum Exporting Countries to balance a market with cuts in output.
Tamas Varga, an analyst with broker PVM, said that when discounting Indonesia from OPEC's target production level, and including exempt member states Libya and Nigeria, the levels are actually slightly higher than the benchmark set late last year.
"It does not seem encouraging," he wrote in a report emailed early Monday.
Crude oil prices were drifting slightly lower about a half hour before the start of trading in New York. The price for Brent crude oil was lower than Friday's close by 0.6 percent to $56.47 per barrel. West Texas Intermediate, the U.S. benchmark price for crude oil, was down 0.3 percent to $53.65 per barrel.
Indonesia's OPEC membership was suspended after the agreement was reached. Libya and Nigeria are exempt while they counter civil conflict.
Varga said there's a "tug-of-war" in the oil market, with no clear signs emerging to push prices in one direction or the other.
Russia is party to the OPEC agreement and said it was coordinating its efforts with its counterparts in Venezuela, among other producers.
"Moscow and Caracas made a significant contribution into the relevant decision made by OPEC and other major oil producing countries last December in Vienna," Russia Foreign Minister Sergei Lavrov said.
The Central Bank of Russia said last week it was keeping its key lending rate unchanged, pointing to slow growth expectations for the year. In a report published Monday, the Russian Finance Ministry said crude oil prices still presented a risk for the nation's economy, even after recovery starts to take hold.
The report said crude oil prices would likely stay between $40 per barrel and $60 per barrel through 2019.