March 14 (UPI) -- Oil prices moved lower Tuesday, with the price for Brent threatening to break under $50 per barrel after OPEC revealed data on production cut compliance.
Crude oil prices traded in a narrow band around $55 per barrel for most of the year since January after deal was coordinated by the Organization of Petroleum Exporting Countries to curb output in an effort to offset supply-side strains.
OPEC's agreement, which counts non-member states like Russia as contributors, put a psychological floor under crude oil prices. The duration of the price band around $55 per barrel improved the economics for expensive basins like U.S. shale oil, and gains in production there put a ceiling over the price of oil.
Last week, production and supply gains from the United States pushed crude oil prices down 5 percent. Tuesday, it was OPEC's turn, with Saudi Arabia telling OPEC economists its production for February increased by about a quarter million barrels per day to move above 10 million barrels per day.
Oil prices were trading in positive territory overnight, but swiftly moved lower after OPEC released its latest monthly market report.
"The report that Saudi Arabia is raising output was enough to squash the meager recovery," Phil Flynn, a senior market analyst for the PRICE Futures Group, told UPI.
The price for Brent crude oil was lower than the previous close by 1 percent to trade at $50.82 per barrel about a half hour before the start of trading in New York. West Texas Intermediate, the U.S. benchmark for the price of oil, was down 1.3 percent to $47.76 per barrel.
The price for Brent crude oil is down nearly 10 percent, or close to $7 per barrel, from its peak this year.
Prices may be influenced late in the day when the American Petroleum Institute releases data on crude oil inventories in the United States for the week. Data from the world's leading economy is key for investors betting on future price movement.
Official U.S. data is released Wednesday, and S&P Global Platts expects federal data will show a build of 3.5 million barrels, roughly half the level reported last week and less than the 4.3 million barrels reported on average over a four-year period.
Elsewhere, Platts Futures Editor Geoffrey Craig said investors may be making bets on direction from the U.S. Federal Reserve. A rate hike would strengthen the value of the U.S. dollar and subsequently influence crude oil prices.
"Traders will be trying to discern what the Fed's probable course of action will be for the rest of the year; any hint of dovish [low-interest-rate] leanings by monetary authorities could shake currency markets and affect energy prices," he said in an emailed report.