(Bloomberg) —Oil resumed its decline toward $40 a barrel as U.S. producers increased drilling for a fifth week amid a glut of crude and fuel supplies that are at the highest seasonal level in at least two decades.

Futures slid as much as 0.9 percent in New York after rising 1.1 percent on Friday as a weakening dollar bolstered investor appetite for commodities. Drillers boosted the number of rigs by 3 for the longest run of gains since August, according to a data from Baker Hughes Inc. Libya has reopened four oil export ports, according to a statement from the Petroleum Facilities Guard.

Oil capped the biggest monthly decline in a year in July as the price recovery falters after almost doubling from a 12-year low in February. Producers including BP Plc, Royal Dutch Shell Plc and Total SA reported sharp declines in second-quarter earnings as lower energy prices take a toll.

“There is a clear downward momentum to the market at the moment,” said Michael McCarthy, a chief strategist at CMC Markets in Sydney. “There are concerns about the oversupply situation continuing. Clearly $40 a barrel is a key point for West Texas and I’d expect to see support there given the bounces we’ve seen previously at that level.”

West Texas Intermediate for September delivery lost as much as 38 cents to $41.22 a barrel on the New York Mercantile Exchange and was at $41.36 at 8:03 a.m. Hong Kong time. The contract rose 46 cents to $41.60 on Friday, snapping an 8.5 percent decline over six sessions. Total volume traded was about 54 percent below the 100-day average. Prices fell 14 percent in July.

Brent for October settlement dropped as much as 42 cents, or 1 percent, to $43.11 a barrel on the London-based ICE Futures Europe exchange. The September contract expired Friday after falling 24 cents to $42.46, capping a 14.5 percent drop for the month. The global benchmark was at a premium of $1.17 to WTI for October.