New York's main contract, light sweet crude for July delivery, lost 52 cents to $98.49 a barrel and Brent North Sea crude for July delivery dipped 41 cents to $114.07.

"Today the focus will still be on the OPEC meeting, as other countries including Saudi Arabia want to hike production and keep prices lower," said Ker Chung Yang, a commodity analyst at Phillip Futures in Singapore.

"Only Iran and Venezuela may not want to hike production and want to keep prices higher," he added.

The 12-nation Organisation of the Petroleum Exporting Countries (OPEC) oil cartel will meet Wednesday in Vienna amid growing fears that high crude prices could further dent world economic growth and energy demand.

The oil cartel pumps about 40 percent of global supply.

Most analysts expected the cartel would leave production quotas unchanged despite a surge in crude oil prices spurred by unrest in the Arab world, particularly in Libya.

Iran, OPEC's second-biggest crude producer, favours high oil prices and traditionally opposes an increase in production of the cartel.

Tehran's OPEC representative said Monday that the Islamic republic was against any increase in OPEC output.

"There is no need to increase production of OPEC countries at the 159th meeting of the organisation," Mohammad Ali Khatibi was quoted as saying on the state television website.

"The market is balanced... the downward trend in oil prices means that producers must be very cautious before any increase in output," he said.

The country currently holds the rotating OPEC presidency for the first time since the 1979 Islamic revolution.

Meanwhile, investors await the crude inventories report from US, the world's largest economy and oil consumer, for leads later Tuesday.

The International Air Transport Association (IATA) on Monday halved its profit forecast for the airline industry to $4 billion in 2011 due to the effects of the Japan tsunami, unrest in the Middle East and North Africa and high oil prices.

High oil prices are the biggest culprit dragging down the industry's profitability, said IATA, which has raised its average Brent crude forecast by 15 percent to $110 a barrel for 2011.

Previously, the airline body estimated Brent crude would average $96 a barrel this year.

Copyright AFP (Agence France-Presse), 2011