Oil is flashing red on fears of rising supplies

• Oil benchmarks are reporting moderate losses in Asia on prospects of increased supplies
• Russia is reportedly considering a gradual increase in supplies.
• API reported a rise in US oil inventories.

Oil is on the defensive amid rumors Russia is considering boosting its oil supplies back to 2016 highs.

As of writing, Brent front-month contract is trading at $75.64/barrel - down 24 cents or 0.31 percent. Meanwhile, WTI price is seen at $66.00/barrel - also down 38 cents or 0.57 percent.

Russia is considering making a proposal that OPEC and its allies be allowed to return production to October 2016 levels, a person familiar with the matter told Bloomberg.

The bearish tone in the oil markets could be also be associated with an 833,000 barrel rise in US oil inventories in the week ended June 8, as reported by the American Petroleum Institute (API) yesterday.

The sell-off would gather pace in the US session if the data from the Energy Information Administration (EIA) shows a big jump in US oil stockpiles.