Nov. 27 (UPI) -- A resilient U.S. shale oil sector and the jitters over a spoiler for the OPEC effort to balance the market sent crude oil prices lower on Monday.
North American crude oil prices are under pressure in part because the Keystone pipeline network remains shut in after a release in North Dakota. Of the major crude oil price benchmarks, Western Canadian Select, the Canadian benchmark for the price of oil, is down the most early Monday as much of the Keystone oil remains locked north of the U.S. border.
Nevertheless, the North American energy sector is showing signs of strength as crude oil prices in general hold above $50 per barrel. According to drilling service Baker Hughes, both Canada and the United States showed gains in exploration and production last week.
For the United States, production last week was around 9.6 million barrels per day, a gain of almost 10 percent since the start of the year. Ministers from the Organization of Petroleum Exporting Countries revealed Monday a special session was held last week to review U.S. shale oil production.
OPEC ministers later this week consider the fate of a deal to balance the market with coordinated production cuts. OPEC already said the effort has cut the record glut down by about half and it's widely expected that delegates in Vienna will agree to some form of extension deeper beyond the March expiration date.
Stephen Brennock, an analyst with London oil broker PVM, said in an emailed market report that the prospect for an extension is "largely baked into sentiment" and the focus is now on who says what later this week.
"Common interests between the Saudis and Russia dictate that they should stick to the plan," he said. "Still, the potential for an upset will cast a shadow over oil prices in the run-up to Thursday's meeting."
The price for Brent crude oil, the global benchmark, was down 0.25 percent from last week to $63.70 per barrel as of 9:10 a.m. EST. West Texas Intermediate, the U.S. benchmark, was down 1 percent to $58.34 barrel.
The OPEC basket, meanwhile, was up 0.8 percent to $61.64, indicating traders expect discipline from Vienna.
Even if OPEC manages to agree on an extension, Ole Hansen, the head of commodity strategy at Saxo Bank, told UPI it will still need to be a "robust" extension and have all of the producers on board, otherwise "little would have been achieved."
Libya and Nigeria are exempt from the agreement so they can use oil revenue for national security purposes. Both countries have shown steady production gains for the year.
Elsewhere, French energy major Total said it pulled the first barrels of oil out of the giant Libra field offshore Brazil. Production there could eventually reach 150,000 barrels per day.