Citigroup said OPEC output cuts will be able to offset the response of USA producers to higher prices.
Analysts said they expected crude oil inventories to have fallen by around 1.5 million barrels last week.
"The rebalancing in US crude stocks may have got underway, but concerns about further gasoline builds are rife even as the USA summer driving season shifts up a gear", said Stephen Brennock, an analyst with PVM Oil Associates.
Now the deal's participants must weigh whether another such agreement is worth it, given that any price increases would spur more US production.
OPEC members Saudi Arabia and Kuwait signaled that the Organization of the Petroleum Exporting Countries and other producers, including Russian Federation, would likely extend their oil output cut beyond June.
While there is a risk of further "verbal intervention" from OPEC officials - something that has time and time again boosted energy stock and oil prices since a production freeze agreement was first teased in February 2016 - the sector looks vulnerable for further losses.
Industry data show crude oil inventory levels on the decline, suggesting some supply-side strains are fading, but US metrics have been consistent with estimates of gains in crude oil production.
"Rising U.S. production levels are offsetting more than a third of the six-month agreement of the 1.8 million barrel-per-day cut", McGillian said.
Global benchmark Brent crude futures were down 26 cents at $55.10 a barrel at 0803 GMT.
The gasoline inventory rose by 1.4 million barrels as refinery runs increased by 334,000bpd in the US. WTI was trading 30 cents lower at $52.35 a barrel on the New York Mercantile Exchange at 10:34am London time on Tuesday.
Members of the Organization of the Petroleum Exporting Countries are cutting oil production 1.2 million bpd from January 1 for six months, the first reduction in eight years.
Opec was due to meet on May 25 to weigh an extension of output cuts beyond June to alleviate a glut that has depressed prices for almost three years.
U.S. West Texas Intermediate (WTI) crude futures were up 12 cents, or 0.2 percent, to $50.56 a barrel. Other sources corroborated Saudi Arabia and Kuwait's support of Iraq's stated goal, which will barely generate enough revenues to sustain Baghdad's ongoing war with the Islamic State in Mosul.
A number of key OPEC members including top exporter Saudi Arabia support extending their supply cut into the second half of 2017 if all participating producers, including Russian Federation and other non-OPEC countries, agree, OPEC sources have told Reuters.