Oil ticks higher in Asia, eyes API report

Oil is trading higher in Asia following Monday’s sell-off in what appears to be a chart driven move, although increase in the US drilling activity is keeping the gains under check.

At the time of writing, Brent oil was up 0.5% or 28 cents at $55.50/barrel. WTI oil was up 25 cents or 0.5% at $53.00/barrel.

Prices fell 1% on Monday as signs of increased activity in the US overshadowed OPEC and non-OPEC production cuts. The data released on Friday had shown the number of US oil rigs rose at a fastest rate in nearly four years.

The data adds credence to the argument that higher oil prices would be exploited by Shale producers to boost output. The focus now is on the weekly American Petroleum Institute (API).