Giovanni Stauvano, a commodity analyst at UBS, told UPI that oil "seems to be caught" between a stronger USA dollar and concerns on the potential trade war.
"OPEC's production cuts are working and we are seeing a steady decrease in a global supply glut", Ahn Yea Ha, a commodities analyst at Kiwoom Securities, said by phone. On the New York Mercantile Exchange, West Texas Intermediate futures were trading down 1.8% at $62.36 a barrel. The contract rose 50c to $63.51 on Tuesday.
Total products supplied over the past four-week period averaged over 20.9 million barrels per day, up by 7 percent from the same period previous year.
Front-month London Brent crude for June delivery was up 20 cents, or 0.3 percent, at $68.22, having ended down 10 cents. The global benchmark crude traded at a $4.62 premium to June WTI.
The net long position in futures and options tops 600 million barrels of oil, the data shows, meaning that in the event of a sharper drop in price, sellers may find a dearth of buyers.
Meanwhile, Japan's oil demand decline is set to accelerate amid a shrinking population. Immediately before the Energy Information Administration's report on Wednesday both WTI and Brent hit two-week lows, pressured by the escalating trade war between China and the U.S. But oil prices rebounded sharply after the EIA reported that U.S. crude inventories dropped by 4.6 million barrels last week, despite analysts' expectations for an increase of 246,000 barrels.
Oil prices headed higher on Thursday after reports out of the United States showed a drawdown in US crude stockpiles that analysts did not expect.