U.S. oil closed lower on Tuesday, after UAE Oil Minister Suhail bin Mohammed al-Mazroui said he was happy with the oil market, noting that prices had been correcting higher.
"We are optimistic. We are seeing that the market is correcting upward," Mazroui told reporters in Vienna.
Oil ministers from the Organization of the Petroleum Exporting Countries meet on Thursday in the Austrian capital.
That said, oil posted its fourth straight monthly gain, with investors betting on higher U.S. fuel demand as peak driving season arrived in the No. 1 oil consumer.
Data from market intelligence firm Genscape showed a drawdown of 686,700 barrels at the Cushing, Oklahoma delivery point for U.S. crude futures in the week to May 27, traders said, a report that provided further support to oil.
Strong U.S. consumer spending data also supported oil prices, despite concerns that a robust economy could encourage the Federal Reserve to raise interest rates soon.
U.S. West Texas Intermediate (WTI) settled 0.47 percent lower, or 23 cents, at $49.10 a barrel. WTI hit a 7-month high of $50.21 on Thursday and notched a more than 7 percent gain for May.
Brent crude oil futures were down 9 cents at $49.67. Brent hit a November peak of $50.51 on Thursday and posted a more than 3 percent monthly gain.
Investors brushed aside earlier concerns about higher Middle East output that had weighed on Brent, and a fight for market share between Saudi Arabia and Iran, both of which will gather with other OPEC members for a meeting on Thursday.
"The bulk of our technical indicators remain tilted in a bullish direction ... with upside possibilities to the $52-52.50 areas still valid," said Jim Ritterbusch of Chicago-based oil consultancy Ritterbusch & Associates.
U.S. fuel demand is set to rise with the summer driving season that began with Monday's Memorial Day holiday. Hedge funds and other money managers last week raised bullish bets on WTI to 2016 highs for a second week in a row as prices headed toward $50 a barrel.
On the global supply end, Asian imports of Iranian oil rose more than 13 percent in April from a year before.
Iraq will supply 5 million barrels of extra crude to its international oil company partners in June, industry sources familiar with the issue said.
Iraq had been targeting record crude export volumes from southern terminals next month of 3.47 million barrels per day, ahead of the June 4 meeting of the Organization of the Petroleum Exporting Countries.
"Anyone betting on a surprise outcome in Thursday's meeting is brave in doing so," Vienna-based JBC Energy said in a note.
Saudi Arabia, the world's top crude exporter, and fellow OPEC producers Kuwait, Iran and the United Arab Emirates, also plan to raise supplies in the third quarter.
One topic on the group's agenda is selecting a new secretary-general to replace Abdullah al-Badri, with Nigeria's Mohammed Barkindo emerging as a front-runner, sources tell Reuters.
The number of outstanding managed short crude positions of U.S. WTI crude futures on NYMEX fell last week to the lowest level this year.
"Since the start of the rally back in February ... speculative length on the NYMEX have been growing by 0.6 percent per week, whereas speculative shorts have been falling by 8 percent per week," the U.S.-based Schork Report said in a note to clients.