Oil prices have rallied by 40 percent since the middle of the year, supported by a deal between the Organization of the Petroleum Exporting Countries (OPEC) and other major exporters, such as Russian Federation, to reduce crude oil production by 1.8 million barrels per day (bpd).
Oil prices were down heading into today's data and heading into this week's meeting, with WTI down $.015 (-0.26 percent) at $57.96 at 2:00pm EST, and Brent crude down $0.19 (-0.30 percent) at $63.19.
January West Texas Intermediate crude fell by 69 cents, or 1.2%, to settle at $57.30 a barrel on the New York Mercantile Exchange after tapping earlier highs above $58.
Answering the question whether Iraq itself supports the extension of the Vienna agreement, the minister replied: "Yes, of course". Visit MarketWatch.com for more information on this news.
"Consensus expectations for the OPEC meeting this week have moved to neutral/negative, with fears that Russian Federation may block a unified OPEC/non-OPEC cut extension through full year 2018", said analysts led by Sam Margolin at Cowen, in a note.
Oil traders have largely priced in a full nine-month extension of the current production agreement between OPEC and its non-OPEC allies, and ministers have done little to temper expectations.More news: Wait for 3-4 quarters before concluding on growth rate: Chidambaram
Gasoline stocks rose 3.6 million barrels, compared with forecasts for a 1.2 million-barrel gain.
OPEC members made a decision to cut production by 1.2 million barrels per day. That was the largest weekly average, based on EIA data dating back to 1983 (https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=WCRFPUS2&f=W).
OPEC and non-OPEC countries made a decision to extend oil output cuts for nine months in Vienna on May 25. "So, bottom line, rising US oil production is a lose-lose for oil prices".
Most of the drop can be attributed to a fall in stocks at the Cushing, Oklahoma, delivery hub, which was down by 2.9 million barrels, EIA said.
Distillate inventories also saw a build this week, up 2.696 million barrels, against a forecast of a 230,000-barrel build. December heating oil ended down 1.5% at $1.922 a gallon. Refinery utilization rates rose by 1.3 percentage points.