Oil prices went south on Wednesday after Chinese import data showed a slowdown in demand and as a trade dispute between Washington and Beijing escalated further.
Figures released Wednesday by the U.S. Energy Information Administration (EIA) showed crude inventories fell by 1.4 million barrels in the last week, compared with analysts' expectations for an decrease of 3.3 million barrels.
Gasoline stocks rose by 2.9 million barrels, compared with analysts' expectations for a 1.7-million-barrel drop. The EIA data also revealed distillate stockpiles, which include diesel and heating oil, rose by 1.2 million barrels, versus expectations for a 220,000 barrels increase
U.S. West Texas Intermediate (WTI) crude futures fell $1.38, or 2%, to $67.79 U.S. per barrel after China said it was retaliating against U.S. tariffs by slapping additional import duties of 25% on $16 billion worth of U.S. goods, including fuel oils and diesel.
Front-month Brent crude oil futures were down $1.25, or 1.7%, at $73.40 U.S. per barrel mid-morning Wednesday.
China's crude imports recovered slightly in July after falling for the previous two months, but were still among the lowest this year due to a drop-off in demand from the country's smaller independent, or "teapot," refineries.
Shipments into the world's biggest importer of crude came in at 36.02 million tonnes last month, or 8.48 million bpd, up from 8.18 million bpd a year ago, and just up on June's 8.36 million bpd, data from the General Administration of Customs showed.
In terms of production, the EIA on Tuesday slightly cut its 2018 expectation for average 2018 U.S. crude output to 10.69 million bpd, down from its previous estimate of 10.79 million bpd.
