While rates of global production have slowly risen, it's unlikely that oil producers will be able to keep up with demand thanks to restrained production in both the United States and Saudi Arabia.
Brent futures dipped 4 cents to $79.53 a barrel by 0006 GMT, after climbing 35 cents on Tuesday.
The Organization of the Petroleum Exporting Countries and a group of non-OPEC producers led by Russian Federation started withholding output in 2017 to tighten the market and prop up prices.
"This discussion about possible OPEC supply increases after the June meeting has put a brake on the oil price for the time being, so $80 is a big hurdle to overcome", Commerzbank strategist Carsten Fritsch said.
"The resumption of consumer hedging and backend buying after several years" is pushing up long-dated oil prices, said Amrita Sen, chief oil analyst at consultants Energy Aspects Ltd in London.
The price of crude is the main factor weighting the markets today. "Putting some oil back into the market will prevent oil prices from going to $100 in the second half of 2018, which is good".
Indeed, Sinopec 600028.SS , Asia's largest refiner, will boost US crude oil imports to an all-time high as China tries to reduce its trade deficit with the United States, two sources with knowledge of the matter said. Meanwhile Pierre Andurand, one of the most prominent hedge fund managers in the oil market, recently said that $300 a barrel was "not impossible".
A number of participants in the transaction to limit oil production of OPEC and non-OPEC should increase production in order to avoid overheating of the oil market, said on Thursday the head of "Gazprom oil" Alexander Dyukov.
Assuming an average oil price of $70, the fiscal 2019 subsidy would total about 355 billion rupees, or 105 billion rupees higher than budgeted, according to Kotak Institutional Equities. That move is likely to result in higher prices as demand outpaces supply.
The drop erased a three-week rally that was based in large part on geopolitical worries about unrest in Venezuela and US calls to curtail purchases of Iranian oil.
The blend of oil from Alberta's oilsands is known as Western Canada Select and it, too, has risen to a more than three-year high, nearly touching $58 US on Tuesday.