Global oil prices weakened on Thursday, with both benchmark Brent and U.S. crude surrendering early gains in volatile trading before the expiry of their front-month contracts and in fears of a supply build at the delivery point for U.S. oil.
The reopening of the Houston Shipping Channel for oil imports and the potential nearing of a deal to end a U.S. refinery workers strike contributed to market bearishness, traders said.
"The ship channel opening allows crude to get to refineries and the expectation is that with margins strong, refiners will produce as much as they can and this is putting some pressure on oil futures," said Phil Flynn, analyst at Price Futures Group in Chicago.
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"The strike news is mainly psychological in that it hadn't yet had a big impact on production, but a settlement would soothe concerns about the possibility the strike could eventually hurt output."
Oil prices had earlier risen after the dollar's rally stalled on surprisingly weak U.S. February retail sales data. Dollar-denominated commodities, such as oil, become more appealing to holders of other currencies when the greenback depreciates.