Oil prices tumbled last week, hit by the stubbornly high distillate supplies combined with rising US output reported by the EIA. US drillers added to their operational oil rigs for 14-straight weeks, extending an 11-month recovery that analysts say should result in a big jump in US shale production in May. Adding to the bearish pressure was the investor scepticism surrounding the efficacy of the OPEC-led production cuts.
Even after three months of curbs, OPEC has failed to meet its goal of pushing global supplies below the five-year historical average. Technical analysts reckon that having convincingly broken below $50.00 a barrel, US crude futures could very well slide all the way to $47.00, which presents the next visible support area. US crude for June delivery was last seen around the $49.90-mark.