LONDON, May 26, 2015 (Reuters) – Oil fell below $65 a barrel on Tuesday, pressured by the possibility that U.S. shale oil producers could increase drilling activity and by a stronger dollar.
U.S. drillers cut the number of rigs by just one last week, data showed on Friday, and Goldman Sachs said prices were at a level that would spur activity.
Brent crude was down 91 cents at $64.61 a barrel at 1345 GMT, while U.S. crude, also known as WTI, was 85 cents lower at $58.87.
More drilling in the United States would lessen the prospect of a tighter oil market in coming months, one of the factors that have helped Brent rise from a near six-year low close to $45 in January.
“We believe that should West Texas Intermediate prices remain near $60 a barrel, U.S. producers will ramp up activity, given improved returns,” Goldman said in a report.
The Organization of the Petroleum Exporting Countries gathers on June 5. On Sunday, Iran said OPEC was unlikely to change its production ceiling at the meeting.