Oil declined as a smaller-than-expected draw in U.S. crude and gasoline inventories added bearish sentiment to a market already reeling from a gloomy economic outlook.

Futures fell as much as 1.2% in New York after gaining 1.9% on Wednesday. While American crude and gasoline stockpiles both fell for a third week, they dropped less than forecast in a Bloomberg survey. Anxieties over demand resurfaced earlier this week after a slew of sluggish economic indicators from the U.S., China and Europe, even as the Organization of Petroleum Exporting Countries and its allies agreed to extend output cuts into 2020.

West Texas Intermediate oil for August delivery lost 59 cents, or 1%, to $56.75 a barrel on the New York Mercantile Exchange as of 7:13 a.m. in London. The contract gained $1.09 on Wednesday, recovering some ground after slumping the most since May 31 in the previous session.

Brent for September settlement declined 68, or 1.1%, cents to $63.14 a barrel on the ICE Futures Europe Exchange. Prices increased 2.3% on Wednesday. The benchmark global crude traded at a premium of $6.31 to WTI for the same month.

Source : Bloomberg