U.S. crude oil prices slipped below $50 per barrel on Monday but stayed close to multi-month highs amid a drop in shale drilling and as refineries continued to restart after Hurricane Harvey.
U.S. West Texas Intermediate (WTI) crude futures were down 27 cents at $49.62 at 1115 GMT, but still close to Thursday’s near-four month high of $50.50.
Brent crude futures were 33 cents lower at $55.29 a barrel, near an almost five-month high of $55.99 touched on Thursday.
“Demand forecasts from OPEC and IEA … continued to improve sentiment in the market. Refineries are also reporting a much better recovery from the recent hurricanes,” ANZ bank said in a note.
Oil refineries across the Gulf of Mexico and the Caribbean were restarting after being shut as hurricanes Harvey and Irma battered the region over the past three weeks.
Royal Dutch Shell’s (RDSa.L) Deer Park refinery in Texas was among the latest, beginning its restart on Sunday. The plant can process 325,700 barrels per day.
The refinery restarts are occurring “as signs emerge of stalling growth in the U.S. shale industry. The number of rigs drilling for oil in the U.S. fell sharply last week,” ANZ said.
U.S. energy firms cut seven oil rigs in the week to Sept. 15, bringing the total to 749, the fewest since June, energy services company Baker Hughes said on Friday.
Speculators raised their net long positions in Brent futures and options by 16,962 contracts to 430,699 in the week to Sept. 12, InterContinental Exchange (ICE) data showed, the highest level since March. The increase was the first in four weeks.
Hedge funds and other money managers cut their bullish bets on U.S. crude futures and options in the week to Sept. 12, the U.S. Commodity Futures Trading Commission reported on Friday.