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 Oil stocks held by countries in the Organisation for Economic
Cooperation and Development may come close to the all-time high of
2.83 billion barrels in the middle of 2015, said the IEA, which
advises the West on energy policy.
"Despite expectations of tightening balances by end-2015, downward
market pressures may not have run their course just yet," the IEA
said in a monthly report.
Brent crude slipped 44 cents to $57.90 by 1123 GMT (06:23 am.
EST), ending a three-day rally. The benchmark gained more than 9
percent last week, its biggest weekly rise since February 2011.
U.S. crude futures dropped to $52.02, down 84 cents.
Vitol chief Ian Taylor, speaking at the International Petroleum Week
industry conference, said he expected a "dramatic" build in oil
stocks over the next few months but that supply and demand in the
oil market would move into balance in the second half of this year.
China's consumer inflation hit a five-year low for January, raising
worries about oil demand in the world's second-largest economy.
"Economic activity is slowing, especially in heavy industry and that
inevitably weighs on commodities," Michal Meidan, director of
independent consultancy China Matters, said in the Reuters Global
Oil Forum.
Oil prices received a boost on Monday after a monthly report by the
Organization of the Petroleum Exporting Countries (OPEC) raised the
forecast for 2015 demand for its oil to 29.2 million barrels per day
(bpd), up 430,000 bpd from an earlier forecast.
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The IEA's medium-term report released on Tuesday predicted demand
for OPEC oil would hold at 29.4 million bpd this year, and said U.S.
shale oil output growth would pause before regaining momentum.
U.S. crude snapped three days of gains after a preliminary survey
showed that U.S. commercial crude stockpiles likely hit a record
high last week.
"Another report of strong builds in inventories in this week's EIA
market report could halt oil's rally," ANZ bank said, referring to
the U.S. Energy Information Administration's stockpile data due on
Wednesday.
Elsewhere, Libya's Hariga port has reopened after guards ended a
strike over salary payments, and the terminal will start loading
tankers once better weather allows, a facility spokesman said.
(Additional reporting by Adam Rose in Beijing; Editing by Dale
Hudson)
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