WASHINGTON, D.C. (DTN) -- Nearest delivered New York Mercantile Exchange oil futures and Brent crude on the Intercontinental Exchange shifted higher in early trading Tuesday amid expectations of a drawdown in U.S. oil inventories, while Organization of the Petroleum Exporting Countries are likely to continue withholding supplies for the full year.
Nymex June West Texas Intermediate futures were up $0.30 at $63.40 ahead of the contract's expiration at the close, with July delivery at parity with the expiring contract. ICE July Brent futures were up $0.20 near $72.15 per barrel (bbl). Nymex June RBOB futures were up 0.85 cents near $2.0185 gallon, with the June ULSD contract easing 0.25 cents to $2.0710 gallon.
WTI and Brent hit three-week highs on Monday amid reports OPEC would continue with production cuts beyond June. Saudi energy minister said the group reached consensus that the agreement should be extended through year end, as global oil inventories are still above the 5-year average level.
The latest OPEC data showed total commercial crude inventories held by the 36 country bloc Organization for Economic Cooperation and Development rose 3.3 million bbl in March, registering a 22.8 million bbl surplus against the 5-year average.
OPEC said this weekend the group reached 168% compliance with the current agreement in April, while total production last month slipped to 30.31 million barrels per day (bpd), a 4-year low.
In the United States, market participants expect commercial crude stocks fell 2 million bbl in the week ended May 17, after gaining 5.4 million bbl a week prior. In refined products, analysts expect U.S. gasoline inventories built by 1 million bbl last week, while distillate stockpiles fell 1 million bbl.
Preliminary supply data on U.S. inventories is due for release from the American Petroleum Institute at 4:30 p.m. ET, while official figures from U.S. Energy Information Administration are set to be published 10:30 a.m. ET Wednesday.
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