LONDON (Bloomberg) -- Oil continued to slide from a three-year high on speculation that a record long position built up by money managers leaves prices vulnerable to a pullback.

U.S. futures fell for a second day. Hedge funds increased their net-long position in WTI to an all-time high of 437,770 contracts in the week to Jan. 9, according to the Commodity Futures Trading Commission. Citigroup Inc. and UBS Group AG said prices will probably weaken this year as supplies pick up. Technical indicators also showed futures are overbought.

While oil closed lower Tuesday for the first time in more than a week, prices extended gains at the beginning of this year as OPEC and its allies including Russia trim output to drain a global glut. Banks from Citigroup to Societe Generale SA have started to speculate the supply deal may end early, but Russian Energy Minister Alexander Novak said this week that cuts should continue and there’s no need to make hasty decisions after recent price gains.

“Crude-oil prices are likely to weaken over the course of the year” as the market moves from deficit to balance, said Giovanni Staunovo, an analyst at UBS in Zurich.

West Texas Intermediate for February delivery was at $63.61/bbl on the New York Mercantile Exchange, down 12 cents, at 2:14 p.m. London time. There was no settlement Monday because of the Martin Luther King Jr. holiday in the U.S., and all transactions were booked Tuesday.

Brent for March settlement dropped 25 cents to $68.90/bbl on the London-based ICE Futures Europe exchange after losing 1.6% on Tuesday. The global benchmark crude traded at a premium of $5.35 to March WTI.

Figures from the Energy Information Administration on Thursday are forecast to show U.S. stockpiles fell for a ninth week, while OPEC’s monthly report the same day will provide a snapshot of compliance with the supply-cuts deal with Russia. The International Energy Agency follows Friday with its own take on the state of the market.