Oil prices fell Tuesday, as some investors took profits after U.S. crude entered a bull market on Monday.
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Light, sweet crude for November delivery fell 34 cents, or 0.7%, to $51.88 a barrel on the New York Mercantile Exchange. Brent crude, the global benchmark, declined 1% to $58.44.
U.S. oil prices posted their largest one-day advance of the year Monday to re-enter bull-market territory, settling nearly 23% above this year's low hit in early June. Brent closed at its highest level since July 2015.
The rapid ascent had some investors cashing in on the gains Tuesday -- U.S. crude is up roughly 10% this month alone.
"The market is consolidating what was a pretty big move higher," said John Saucer, vice president of research and analysis at Mobius Risk Group. "It's perfectly normal to see," Mr. Saucer said, adding that technical momentum is still positive after Monday's rally.
A wave of bullish data this month has buoyed prices, including an upward revision to the International Energy Agency's demand outlook and data showing refiners ramping up operations following Hurricane Harvey. At the same time, investors seem more confident in the Organization of the Petroleum Exporting Countries' plan to rebalance the market through its production-cut agreement, analysts say.
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OPEC and 10 producers outside the cartel, including Russia, first agreed late last year to cap their production in an attempt to alleviate global oversupply and boost prices. The deal was extended in May through March 2018 and signatories have recently indicated a willingness to potentially hold back production through next year.
Crude prices were also boosted on Monday after Turkish President Recep Tayyip Erdo an responded to the Kurdistan independence referendum by threatening to close off a pipeline that carries hundreds of thousands barrels a day from its neighbor to the global market. Kurdistan is a semiautonomous region in northern Iraq that borders Turkey, which has its own Kurdish minority.
"The potential impact from any disruption is fairly significant, with the pipeline having the capacity to ship 700,000 barrels a day," according to analysts at ING Group.
Many investors and analysts will be watching for Wednesday's Energy Information Administration survey for the latest reading on U.S. crude-oil inventories and refinery use. Investors shook off a larger-than-expected rise in crude inventories last week.
The American Petroleum Institute, an industry group, said late Tuesday that its own data for the week showed a 761,000-barrel decrease in crude supplies, a 1.5 million-barrel increase in gasoline stocks and a 4.5 million-barrel decline in distillate inventories, according to a market participant.
Gasoline futures fell 1.3% to $1.6988 a gallon and diesel futures shed 0.6% to $1.8453 to end a four-session winning streak after closing at their highest level since June 2015 Monday.
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(END) Dow Jones Newswires
September 26, 2017 17:09 ET (21:09 GMT)