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Oil prices fell Thursday against four-year highs reached in the previous session, under pressure from rising stocks in the US and after sources said Russia and Saudi Arabia entered into a private agreement in September to increase crude production.
Brent crude futures are trading at $ 85.85 per barrel at 0104 GMT, down 44 cents or 0.5% from their last close.
Brent Wednesday hit a record 86.74 dollars a barrel for four years.
Futures on US crude WTI (West Texas Intermediate) sold 30 cents, or 0.4%, to $ 76.11 per barrel.
"Last week's data showed that the US commercial crude (stocks) was much larger than expected, which generally suggests that oil prices are expected to fall," said Stephen Innes, trade manager for the Asia-Pacific region. Pacific at Oanda, futures broker Singapore.
US stocks of crude oil rose nearly 8 million barrels last week to about 404 million barrels, the largest increase since March 2017, data from the Energy Information Administration said Wednesday.
The weekly utilization rate of the US Midwest refinery has dropped to 78.9%, its lowest level since October 2015, according to the data.
Meanwhile, crude oil production in the United States remained at a record 11.1 million barrels per day (bpd).
"This comes to add to the other big news of the day from Riyadh that … Saudi Arabia and Russia will increase their production," Innes said.
Russia and Saudi Arabia reached a private deal in September to increase oil production, Reuters reported on Wednesday, before consulting with other producers, including the rest of the country. the Organization of Petroleum Exporting Countries (OPEC).
Shares of Russia and Saudi Arabia come as markets warmed ahead of US sanctions against the Iranian oil sector, which are expected to come into effect on Nov. 4, and many analysts are waiting to eliminate about 1.5 million barrels a day.
On the demand side, there is a growing concern that high oil prices and the weakening of emerging market currencies will create a toxic inflationary mix that could erode fuel demand and economic growth.
"We have looked closely at the signals of demand in the market, and what we found is not good," JBC Energy said Wednesday in a note addressed to customers.
The energy consulting firm has announced that it has revised down its forecast of oil demand between Brent prices above USD 80 and dipped currencies in many emerging markets, as well as growing product inventories and ongoing trade dispute between China and the United States.
"We are not talking about cosmetic changes either, we have reduced our forecast growth in demand for 2018 from 300,000 bpd to less than 1.1 million bpd," he said.
