Oil declined after its biggest surge in five weeks as an industry report showed American crude stockpiles expanded, paring a rally that was fueled by signs the U.S.-China trade deadlock may be easing.
Futures lost as much as 1.5% in New York after the American Petroleum Institute was said to report that crude inventories rose by 3.7 million barrels last week. If confirmed by government data Wednesday, it will be a second weekly increase, though a Bloomberg survey predicts a draw in stockpiles. Oil surged 4% on Tuesday after the U.S. postponed tariffs on some Chinese goods, offering a glimmer of hope for global demand.
West Texas Intermediate crude for September delivery fell 69 cents, or 1.2%, to $56.41 a barrel on the New York Mercantile Exchange as of 10:20 a.m. London time. The contract surged $2.17 to settle at $57.10 on Tuesday, the biggest advance since July 10.
Brent for October settlement decreased 55 cents, or 0.9%, to $60.75 on the ICE Futures Europe Exchange. The contract closed 4.7% higher Tuesday, the largest gain since Dec. 26. The global benchmark crude traded at a $4.43 premium to WTI for the same month.