The United States has imposed tariffs on $250 billion worth of Chinese goods, and China has responded with retaliatory duties on $110 billion worth of USA goods.
"Crude futures were declining early Thursday in Asia, as another monthly rise in OPEC output (The Organization of the Petroleum Exporting Countries) in October, combined with expectations of moderating global oil demand growth and official data showing yet another weekly build up in United States commercial crude inventories, weighed on market sentiment", Vandana Hari, founder of Vanda Insights, said in a report.
-China trade war kept pressure on the market.
Both contracts had recovered some ground over the past few days but are now more than $10 a barrel below four-year highs reached in the first week of October.
Oil prices gained after the U.S. Energy Information Administration said crude inventories rose 3.2 million barrels last week, less than expected.
On Tuesday, Brent crude fell by $2.25 a barrel to a low of $75.09 before recovering slightly to around $75.89 as of 8:10pm Nigerian time.
"Everyone thought we were going to go into the $90s, but now we are heading for the $60s", said Tony Nunan, oil risk manager at Mitsubishi in Tokyo, referring to Brent prices.
Brent has declined from a 2018 high of $86.74 in early October amid growing concern over a possible slowdown in global growth as the U.S-China trade dispute heats up and hits emerging market economies in particular.
Hansen said talk of USA waivers from the sanctions potentially being granted to India and South Korea may also reduce the ability of the sanction to impact Iran's ability to produce and export crude oil.
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The United States has imposed tariffs on US$250 billion worth of Chinese goods, and China has responded with retaliatory duties on US$110 billion worth of USA goods.
US oil markets have taken a step lower with the WTI slipping from the 67.00 level following US President Trump's presidential decree that global oil markets have enough supply to make up for any constraints from US sanctions on Iran, which come into effect on November 4th.
Crude inventories rose by 3.2 million barrels in the last week, compared with analysts' expectations for an increase of 4.1 million barrels.
With the top three producers at over 33 billion bpd, they are meeting close to a third of the world's nearly 100 million bpd of consumption.
Investors will look to official government data on USA inventories due on Wednesday.
The United States is set to impose new sanctions on Iranian crude from next week and exports from the Islamic Republic have already begun to fall.
Russian Federation has also indicated that it will provide enough oil to meet demand once U.S. sanctions hit Iran from next week.
Energy Information Administration data showed USA crude inventories last week climbed for a sixth straight week.