Crude oil futures slipped towards $37 per barrel on Wednesday as the market remained under pressure due to slowing demand and high supplies, while forecasts that a cold snap in Europe and the United States would be short-lived also weighed on prices, Reuters reported.
WTI crude oil futures fell 1.7% to $37.25 per barrel during the trading on the Intercontinental Exchange. Brent futures slid 0.9% to $37.45 a barrel, according to Reuters.
U.S. crude and Brent had both rallied about 3% in the previous session on hopes that a drop in temperatures would buoy demand for oil for heating purposes.
Oil prices could, however, draw some support if data shows a drawdown in U.S. weekly oil stocks. A Reuters poll of nine analysts estimated, on average, that crude stocks fell 2.5 million barrels in the week ended December 25.
The U.S. Energy Information Administration will publish its report later in the day.
It is noted that many traders and analysts expect prices to remain under pressure, noting that global oversupply is expected to grow in 2016.
Oil prices will take decades to recover and will still not reach the peak seen in recent years, according to the latest World Oil Outlook from OPEC.
In the group's latest outlook on supply, demand and prices to 2020 and 2040, OPEC predicted that a barrel of oil would cost (in real terms) around $70 by 2020 and $95 by 2040, a far cry from a high point of $114 a barrel last seen in June 2014 before prices began to plunge on oversupply.