Brent crude fell 56 cents a barrel to $79.70 by 12:16 p.m. EDT (1616 GMT), after dropping 3.4 percent on Thursday.
Brent crude futures fell $1.91, or 2.3 percent, to settle at $83.09 a barrel.
Oil prices dropped 2% on Wednesday as US equity markets broadly fell, even though energy traders anxious about shrinking Iranian supply from US sanctions and kept an eye on Hurricane Michael, which closed some US Gulf of Mexico oil output. The facility is the only port in the United States capable of fully loading and unloading a tanker with a capacity of 2 million barrels of oil.
Crude inventories climbed by 6 million barrels in the week to October 5, the U.S. Energy Information Administration reported, compared with analyst expectations for an increase of 2.6 million barrels.
USA crude stockpiles rose more than expected last week, while gasoline inventories increased and distillate stocks drew, the American Petroleum Institute said on Wednesday. India is Iran's top oil client after China.
Oil prices were up in mid-day trading Tuesday as Hurricane Michael barrels toward the Florida panhandle.
In its closely watched Monthly Oil Market Report published on Thursday, OPEC revised down its global oil demand growth to 1.54 million bpd this year, down by 80,000 bpd from the estimate in the September report.
The monthly report from the Organization of the Petroleum Exporting Countries showed the 15-nation producer group's output rose by 132,000 bpd in September to almost 32.8 million bpd.
While Washington has said it wants to cut Iran's oil exports to zero, Iran and Saudi Arabia say that is unlikely. The fears are growing that the USA demands for an Iran oil embargo could cause a significant supply shortfall. Producers lost about 1.7 million barrels of oil through Wednesday as a result of shut-ins and the figure is expected to rise.
They earlier touched their lowest since September 27 at $81.35, after closing 2.2 percent lower on Wednesday.
Money managers cut their net long U.S. crude futures and options positions in the week to October 9, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday.
The group, led by Saudi Arabia, has pledged to increase output to compensate for the loss of any Iranian supply to USA sanctions that come into force next month.