Adding extra pressure are global trade tensions.
Shipping data in Thomson Reuters Eikon shows that USA crude oil shipments to China have soared in value recently, jumping from just US$100 million per month in early 2017 to nearly US$1 billion per month now.
Oil prices fell on Thursday as crude producers appeared to be nearing a deal to increase production at an OPEC meeting in Vienna on Friday, but pared losses after a report of a large stockpile draw at a key storage in the United States.
Brent crude futures were at $74.90 per barrel at 0241 GMT, down 44 cents, or 0.6 percent, from their last close.
OPEC crude production in May slid for the fourth straight month to 31.90 million b/d, the lowest in over a year. The excess is mostly driven by the collapse in crude oil production in Venezuela. The index looks to track the performance of the energy sector of the USA equity market. After writing to OPEC and calling for the organization's support for members targeted by sanctions, Iran, along with Venezuela and Iraq, is going to veto Saudi Arabia and Russia's proposal at the June 22 meeting.
"Volatility is going to be pretty high this week", said Bob Yawger, director of energy futures at Mizuho in NY.
The 174th Meeting of the OPEC Conference, the first full gathering of the year, is to take place on June 22nd in Vienna, Austria.
"Looking ahead, I remain optimistic that we will fulfil our goal of delivering sustainable oil market stability, which is meant to serve the long term interests of producers, consumers and the global economy", Al Mazrouei said in a statement issued by the ministry ahead of 174th Meeting of the OPEC Conference next week in Vienna, Austria.
The Opec kingpin Saudi Arabia and Russian Federation indicated on Friday they would loosen their supply restraint and were starting to raise exports.
On the rising oil prices in the country, the minister assured that the government would leave no stone unturned to keep these products within the reach of the common man. Five shale executives were set to speak at the OPEC seminar this week, but three, including Continental Resources Chief Executive Harold Hamm, have withdrawn.
Increased production of USA shale oil took some sheen away from the anticipated impact of the output cuts.
On the other side, there are OPEC members who would like the price to stay just where it is because they have no spare production capacity and would gain no benefit from any increase in output.
In an escalating spat over the United States' trade deficit with most of its major trading partners, including China, US President Donald Trump said last week he was pushing ahead with hefty tariffs on US$50 billion of Chinese imports, starting on July 6.
Adding to the tensions, Iran and Venezuela continued to insist that OPEC on Friday debate USA sanctions against the two countries, but the organisation's secretariat has rejected their requests, according to letters seen by Reuters.
"It's more of a threat than anything", said Joe McMonigle, senior energy policy analyst at Hedgeye Potomac Research.
Benjamin Lu of brokerage Phillip Futures said Beijing's retaliation had spooked oil investors: "These punitive measures on bilateral trade have unnerved investors as it hurts global economic growth".
'The risks to the outlook are on the downside, ' said BCC head of economics Suren Thiru.