WTI prices drop as US inventories decline

June contracts for West Texas Intermediate crude were down 83 cents to $58.02 per barrel Wednesday after the US Energy Information Administration said that crude oil stockpiles in the US fell unexpectedly last week.

US crude oil inventories dropped by 4.7 million barrels in the week ending 8 May against expectations that they would add over a million barrels.

Still, at 370.6 million barrels in storage, crude oil inventories are still 44.8 million barrels over last year at the same time and stockpiles remain at their highest level since 1990.

US gasoline inventories were also down, by 4.1 million barrels to 208.3 million barrels, while distillates in storage added 1 million barrels and remain 40.4 million barrels higher than last year at the same time.

The declines came after equities markets declined in response to the news on US retail sales.

Also hurting prices was a new estimate from the Organization of Petroleum Exporting Countries that demand for oil will drop by 1.6 million barrels per day this year, coming only a day after the EIA said that it believes oil consumption will be down by 1.8 million barrels per day this year.

Nymex June gasoline futures added 2 cents to $1.69 per gallon on the session while June heating oil closed even at $1.50 per gallon.