Oil prices end gain streak, drop to $61

US West Texas Intermediate (WTI) futures increased 0.09 percent to $55.38 a barrel which was higher by $0.05 from its previous settlement of $55.33.

USA crude oil production C-OUT-T-EIA hit a record of 9.65 million barrels per day (bpd) this month, meaning US output has risen by nearly 15 percent since mid-2016.

The Energy Information Administration is out with the government's numbers this morning.

Benchmark Brent crude oil LCOc1 was up 76 cents at $62.13 a barrel by 1219 GMT, recovering some ground after five sessions of losses. The American Petroleum Institute on Tuesday had reported a 6.5 million-barrel climb, according to sources.

The West Texas Intermediate for December delivery was down 0.37 USA dollar to settle at 55.33 dollars a barrel on the New York Mercantile Exchange, while Brent crude for January delivery lost 0.34 dollar to close at 61.87 dollars a barrel on the London ICE Futures Exchange.

"After all, the need to further extend the agreement shows that the strategy is not working", commodity researchers at Commerzbank said, adding that the "key factor" was rising US shale oil output.

Analysts in a Reuters poll had expected a decrease of 2.2 million barrels.

The threat of higher shale production kept a lid on oil prices for much of 2017, but investors have recently become more optimistic on the market. As of November 7, long positions in crude oil outnumbered short positions by 317,806 contracts, the highest since April 18.

The perception that the Organization of the Petroleum Exporting Countries will extend a deal limiting oil production through March 2018 has helped support oil prices over the past few months.

Distillate inventories saw a decline this week, down 2.527 million barrels.

"It is far too early to write the obituary of oil, as growth for trucks, aviation, petrochemicals, shipping and aviation keep pushing demand higher", said Fatih Birol, executive director of the Paris-based IEA.

Global oil demand is expected to keep rising over the next two decades, albeit at a steadily decreasing pace, according to a new report released Tuesday by the International Energy Agency. But prices were still on track to fall almost 2 percent this week, as fears of oversupply in the United States weighed after government data showed output hit a record 9.65 million bpd last week. Analysts had expected a drop of 500,000 barrels.

-Christopher Alessi contributed to this article.