Oil prices slipped by 2 per cent on Wednesday as the Organisation of the Petroleum Exporting Countries and its allies (OPEC+) mulled accelerating its oil output increases in June.
Brent crude was down by $1.32 or 1.96 per cent to $66.12 a barrel while the US West Texas Intermediate (WTI) crude depreciated by $1.40 or 2.2 per cent to $62.27 per barrel.
Reuters reported that several OPEC+ members will suggest more oil output hikes in June for a second consecutive month as disputes between members over compliance with production quotas worsen.
It was reported that some wanted to increase output by a similar volume to the May increase ahead of a May 5 meeting where eight OPEC+ countries will meet to decide the June output plan.
The May and potential June hikes are part of a plan by Russia, Saudi Arabia, the United Arab Emirates, Kuwait, Iraq, Algeria, Kazakhstan and Oman to gradually unwind their most recent output cut of 2.2 million barrels per day.
OPEC+ also has 3.65 million barrels per day of other output cuts in place until the end of next year to support the market.
There was ease in the market following a report that US President Donald Trump may cut tariffs on Chinese imports.
There is now a possibility that the China tariffs are likely to come down to between 50 per cent and 65 per cent.
This came as US Treasury Secretary Scott Bessent said he believes that excessively high tariffs between the US and China will have to come down before trade negotiations can proceed.
Also, President Trump has backed away from the threat of firing Federal Reserve Chair Jerome Powell after days of criticising the US central bank for not cutting interest rates, easing investor fears about economic uncertainty.
Crude oil inventories in the US saw an increase of 200,000 barrels during the week ending April 18, according to new data from the US Energy Information Administration (EIA) released on Wednesday.
However, both gasoline (petrol) and distillate inventories fell more than expected.
On Tuesday, the American Petroleum Institute (API) reported a different story, showing a large draw of 4.565 million barrels in US crude oil inventories with large draws in gasoline and distillate stocks.
The US had also issued new sanctions targeting an Iranian shipping magnate whose network handles Iranian liquefied petroleum gas and crude oil worth hundreds of millions of Dollars.