Mubasher: Oil extended its dive earlier on Tuesday after Moscow stated that Russia and the Organization of the Petroleum Exporting Countries (OPEC) may ramp up crude production in rivalry with the US over market share, placing brake on a recent rally led by tighter global supply, according to Reuters.

By 4:31 am GMT, global benchmark Brent futures fell 0.25% to $71 per barrel from their prior session, while US Nymex crude futures declined 0.13%.

At 8:04 am GMT, Brent futures inched down 0.10% to $71.11 pb, but Nymex crude futures ticked up 0.09% to $6.346 pb.

Russia and OPEC weigh boosting crude output to win market share in competition with the US, Finance Minister Anton Siluanov said, adding that would send prices to plunge to as low as $40 pb.

“There is a growing concern that Russia will not agree on extending production cuts and we could see them officially abandon it in the coming months,” said OANDA senior market analyst Edward Moya was quoted by Reuters.

OPEC members and non-affiliated producers, an alliance known as OPEC+, are due to meet next June to decide whether to maintain their supply curbs, after previously agreeing to withhold output by 1.2 million barrels per day (bpd) as from last January.

In the same vein, shale oil bonanza in the US has also weighed on crude markets.

US crude output from seven major shale plays is set to climb by around 80,000 bpd next May to a record 8.46 million bpd, the Energy Information Administration (EIA) reported.

Nevertheless, oil losses were kept in check by tightening supplies from Iran and Venezuela, in the face of signs that Washington will further toughen sanctions against the oil-rich nations, as well as the renewed fighting in Libya that could wipe out crude barrels from the major oil producer.