Crude fell after staging a brief rally on Wednesday, as the boost from a drop in U.S. stockpiles and encouraging Chinese factory data gave way to growing investor risk-aversion.
Brent oil bounced off a two-year low and headed toward $96 a barrel on Wednesday and U.S. crude also rose as crude stockpiles fell unexpectedly and Chinese factory data offered signs of hope for the slowing economy.
U.S. crude oil inventories fell 1.4 million barrels last week, compared with an expected increase of 700,000 barrels, U.S. government data showed on Wednesday. A sharp reduction in refinery runs cut gasoline stocks to their lowest in nearly two years and pared distillate supplies ahead of winter. The data from the Energy Information Administration confirmed the American Petroleum Institute's report on Tuesday of a crude inventory decline.