Oil prices fell on Wednesday after news of a rise in US crude inventories last week, defying analysts' expectations for a big fall, while concerns about weak demand also resurfaced.
An oil tanker unloads crude oil at a crude oil terminal in Zhoushan, Zhejiang province, China July 4, 2018.
Brent futures were down 31 cents, or 0.4 percent, at $71.85 a barrel by 0240 GMT.
Oil prices have declined sharply the past week as the Sino-US trade war intensifies and were hovering below $72 per barrel on Tuesday, not far from their lowest since mid-April.
Oil markets have fallen over the last week as Saudi Arabia and other members of the Organization of the Petroleum Exporting Countries and Russian Federation have increased production and as some supply disruptions have eased.
"The uncertainty on the magnitude and timing of the supply shifts has muddied the near-term outlook for oil fundamentals", Goldman said, adding that it continued to expect high supply volatility with potential for further disruptions.
The U.S. oil market has been tight this year but data on Tuesday from the American Petroleum Institute showed an unexpected rise of over 600,000 barrels in crude inventories.
The EIA also said that gasoline inventories had shed 3.2 million barrels in the week to July 13, after a 700,000-barrel decline a week earlier.
Official numbers from the US Department of Energy's Energy Information Administration are due at 10:30 a.m. EDT on Wednesday.
The trade war between the United States and China and Libya's unrest that has resulted in a force majeure have also been complicating the market, along with USA oil production, which has held steady at 10.9 million bpd for the week ending July 06 and the previous five weeks, after being on a tear for most of the 2018.
"The economic outlook is broadly positive, but a number of headwinds are emerging, not least a stronger dollar, rising inflationary pressures and tightening liquidity", BMI said.
Kansas City Federal Reserve Bank President Esther George said that uncertainty over United States trade policy could slow the economy, even if the recently imposed tariffs in and of themselves are too small to have a big impact.
Kansas City Federal Reserve Bank President Esther George said on Tuesday uncertainty over USA trade policy could slow the economy, even if the recently imposed tariffs in and of themselves are too small to have a big impact.
George called trade policy a "significant" downside risk to her outlook for economic growth, even as tax cuts and other fiscal policy is an upside risk.