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Uncertainty surrounding an OPEC-led effort to stabilize the market and 2017 volatility put crude oil prices on track for another round of losses early Tuesday.
Brent crude oil prices failed to capitalize on the weekend optimism surrounding the results of the first round of presidential voting in France, with the pro-European Union candidate Emmanuel Macron now facing off against far-left candidate Marine Le Pen.
Crude oil prices have come under pressure recently from steady North American gains in exploration activity and production volumes. Last year's market downturn was characterized by supply-side pressures building on the back of U.S. oil production and a policy decision from the Organization of Petroleum Exporting Countries to defend a market position with robust output. This year, OPEC is coordinating managed production declines, but uncertainty about the level of commitment in the second half of 2017 has cast a cloud over crude oil prices in recent sessions.
A research note from the Royal Bank of Canada said the price of crude oil is up more than 25 percent year-over-year, but most of the significant gains game in late 2016 and oil prices of late have moved erratically.
"The volatility is unwelcome," analyst Al Stanton said in a report emailed to UPI.
RBC figures Brent crude oil prices have moved between $58.57 per barrel to $50.66 per barrel and is trading about 10 percent lower than the start of the year. The price for the global benchmark was flat about a half hour before the start of trading in New York at $51.63 per barrel. West Texas Intermediate, the U.S. benchmark for the price of oil, was down 0.14 percent to $49.16 per barrel.
Parties to the OPEC production agreement meet to consider an extension next month. In North America, the controversial Dakota Access oil pipeline is expected to start moving oil from North Dakota to southern U.S. terminals by the middle of next month with an initial capacity of 470,000 barrels per day.
A briefing from the analysts at Morningstar emailed to UPI said that influx of new oil to regional markets could create further negative pressure for oil prices.
"The new pipeline will create a surplus in already adequately supplied refining markets in the Midwest and Gulf Coast, with bearish consequences for light crude prices," the note read.
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