Investing.com - Crude oil prices edged higher in Asia on Wednesday after industry data on U.S. inventories showed refined products down more than expected, but crude stocks not falling as much as seen, and the market held cautious ahead of meeting of OPEC and allied producers on May 25.
On the New York Mercantile Exchange crude futures for June delivery rose 0.04% to $51.49 a barrel while on London's Intercontinental Exchange, Brent gained 0.07% to $54.19 a barrel.
Crude oil inventories fell a less-than-expected 1.5 million barrels to 512.9 million barrels at the end of last week, the American Petroleum Institute (API) said on Tuesday, while gasoline showed a bigger than expected drop along with distillates. Gasoline stocks fell by 3.15 million barrels and distillate inventories eased 1.85 million barrels.
The figures will be followed by official data from the Energy Information Administration (EIA) on Wednesday. The API and EIA figures often diverge significantly.
Analysts expected crude inventories to drop by 2.419 million barrels, with distillates seen down 743,000 barrels and gasoline stocks posting a 1.19 million barrels decline.
Overnight, crude futures settled at a five-week high on Tuesday, ahead of the release of a fresh batch of U.S. crude inventories data, expected to show a decline in crude stockpiles for a sixth-straight week amid growing expectations that OPEC will extend production cuts later this week.
Oil prices continued to add to recent gains, as Saudi Arabia seeks to garner support for its proposal to extend the production cuts for a period of nine-months until March 2018, ahead of the Organization of the Petroleum and Exporting Countries meeting later this week.
Kuwaiti Oil Minister Issam Almarzooq said some countries are not in favour of a nine-month extension, but there’s a preliminary agreement on a six-month deal that will be reviewed in November.
OPEC is expected to decide at talks on Thursday, whether to extend the current deal to cut production. Meanwhile, In the U.S., the White House included in its budget proposal, a plan to sell half of the nation's 688 million-barrel oil stockpile from 2018 to 2027, as it aims to raise $16.5 billion to reduce the budget deficit.
Investors’ concerns over the impact of the budget proposal was minimal, as the budget is only a proposal and may not take effect in its current form.