While US oil prices fell for a third day on Wednesday, Brent futures were largely unchanged amid growing concerns that the increased spread of the Delta variant of the coronavirus in the top oil-consuming countries will dampen fuel demand.
West Texas Intermediate (WTI) crude was down 7 cents, or 0.1, to $70.49 a barrel as of 0647 GMT. Brent crude futures rose 1 cent to $72.42 a barrel.
Both futures fell to their lowest levels since July 21 on Tuesday.
Increasing coronavirus cases in China and the USA are curbing oil demand. The United States and China, the world’s two largest oil consumers, are grappling with fast-spreading epidemics of the Delta variant, which both countries fear will limit fuel demand at a time of seasonal oil consumption.
Seasonal weakness in economic activity, increasing cases of the Delta variant continues to affect sentiment about the future.
With the summer travel season at its peak, nearly half of Chinese provinces are besieged by the latest outbreak. This is an important sign that crude oil demand will remain under pressure.
Still, rising geopolitical tensions in the Gulf may offset demand concerns.
Expectations for the return of Iranian crude oil add to the pressure.
On Tuesday, three maritime security sources claimed that Iranian-backed forces had seized an oil product tanker off the coast of the United Arab Emirates, but Iran denied the reports.
This is the second attack alleged since Friday in the Strait of Hormuz region. The UK and the US blame Iran for the previous incident in which two sailors were allegedly killed.
API data shows crude inventories and gasoline stocks fall
According to sources, US crude oil inventories fell by 879,000 barrels in the week of July 30, gasoline inventories fell by 5.8 million barrels and distillate stocks fell by 717,000 barrels.
The decrease in oil, distillate and gasoline stocks provided some support to prices.
