EIA Oil Inventories Expects Smaller Drop From Previous Week

The weekly Energy Information Administration petroleum inventory report is due out at 10:30 a.m. EST, with expectations of a drop of 2 million barrels for the week ending May 29. This follows a 2.8 million barrel drop from the previous week.

The recent figures have been distorted by pipeline shutdowns and revisions.

The American Petroleum Institute released its report earlier Wednesday morning, showing an unexpected increase of 1.8 million barrels in U.S. oil stocks. Oil prices softened following the report, with WTI futures dropping $0.97 to $60.29.

The oil market will be closely watching the OPEC meeting this Friday in Vienna, with the cartel looking to set production levels. The expectation is for OPEC to maintain the 30 million barrel a day production quota. Rumors are that OPEC may look to officially announce an increase in production quotas, since in reality member countries are pumping at more than the 30 million barrel rate to maintain market share.

United Arab Emirates' oil minister Suhail Mohamed Faraj Al Mazrouei said OPEC is prepared to maintain production levels even in the face of falling prices, similar to the course the organization took last November.

WTI futures have firmed, recently trading lower by $0.62 at $60.64.

The United States Oil Fund LP (ETF) (NYSE: USO) was recently down about $0.16 at $20.51.