Investing.com - West Texas Intermediate oil futures declined on Wednesday, as market participants looked ahead to fresh weekly information on U.S. stockpiles of crude and refined products to gauge the strength of demand in the world’s largest oil consumer.
On the New York Mercantile Exchange, crude oil for August delivery shed 23 cents, or 0.44%, to trade at $52.80 a barrel during European morning hours. A day earlier, Nymex oil futures hit $50.38, a level not seen since April 6, before recovering to end at $53.04, up 84 cents, or 1.61%.
Wednesday's government report was expected to show that U.S. crude oil stockpiles fell by 1.2 million barrels last week, while gasoline stockpiles were forecast to rise by 0.7 million barrels.
After markets closed Tuesday, the American Petroleum Institute, an industry group, said that U.S. crude inventories fell by 7.3 million barrels in the week ended July 10, compared to expectations for a drop of 1.8 million.
New York-traded oil futures have been under heavy pressure in recent weeks as worries over high domestic U.S. oil production weighed.
According to industry research group Baker Hughes (NYSE:BHI), the number of rigs drilling for oil in the U.S. rose by five last week to 645, marking the second straight week of gains after 29 weeks of declines.
Elsewhere, on the ICE Futures Exchange in London, Brent oil for September delivery declined 48 cents, or 0.82%, to trade at $58.20 a barrel. On Tuesday, London-traded Brent prices touched $56.75, before turning higher to close at $58.68, up 53 cents, or 0.91%.
The spread between the Brent and the WTI crude contracts stood at $5.40 a barrel, compared to $5.64 by close of trade on Tuesday.
Oil traders assessed the impact of Tuesday's Iranian nuclear deal. Prices initially tumbled by more than 2% as Iran and six world powers reached a long-awaited nuclear deal that would end sanctions on Tehran in exchange for curbs on the country's disputed nuclear program.
However, prices recovered towards the end of the session, with analysts largely estimating that Iranian crude exports could take several months to ramp up significantly.