Oil prices slipped on Tuesday, with Brent falling nearly 2 percent, after Kuwait's oil minister said OPEC was considering a production boost as war-torn Libya's output remained disrupted and the region's unrest fueled concerns about more supplies being cut off. The Organization of the Petroleum Exporting Countries has left official policy steady for more than two years, but analysts have said output has been informally rising.
Saudi Arabia has offered to help make up for Libya's shut output, estimated at about 1 million barrels per day of its normal 1.6 million bpd.
Brent crude for April delivery fell $1.98 to settle at $113.06 a barrel, having fallen as low as $112.13.
U.S. crude futures for April delivery fell 42 cents to settle at $105.02 a barrel, above an early $103.33 low.
"The market is now waiting for the next piece of news to unfold," said Harry Tchilinguirian, head of commodity markets strategy at BNP Paribas.
"A turn for the worse for the market would be oil infrastructure being hit as a result of the fighting. The demise of the current regime or a more forceful statement from OPEC followed by an increase in production would be significant too."
Brent's premium to the U.S. benchmark West Texas Intermediate crude ended post-settlement trading down $1.79 at $7.96 a barrel, down from a record of more than $17 last week.
U.S. gasoline and heating oil futures settled lower, slumping with the Brent contract. High U.S. gasoline prices may be hitting retail demand, which fell 1.8 percent last week against the previous week and was lower against a year ago, MasterCard said.
U.S. OIL INVENTORY REPORTS
U.S. crude stockpiles rose 3.8 million barrels last week, with gasoline stocks falling 3.7 million barrels and distillate stock dropping 1.5 million barrels, the industry group American Petroleum Institute said in a report released late Tuesday.
Oil futures prices showed little reaction to the API data.
A Reuters analyst survey ahead of the API report yielded a forecast for crude stocks to be up 400,000 barrels, distillates down 600,000 barrels and gasoline stocks down 1.5 million barrels last week.
The U.S. Energy Information Administration (EIA) will issue the government's oil data at 10:30 a.m. EST (1530 GMT).