Oil prices edged lower in European trading on Wednesday as investors looked ahead to weekly data from the U.S. on stockpiles of crude and refined products.
The U.S. West Texas Intermediate crude July contract was at $47.98 a barrel by 3:20 AM ET (0720 GMT), down 21 cents, or around 0.4%.
Elsewhere, Brent oil for August delivery on the ICE Futures Exchange in London dipped 22 cents to $49.90 a barrel.
Oil prices finished higher for the first time in three sessions on Tuesday as tension in the Middle East lent some support.
After the markets closed Tuesday, the American Petroleum Institute said that U.S. oil inventories fell by 4.62 million barrels in the week ended June 2. The API report also showed a sizable gain of 4.1 million barrels in gasoline stocks, while distillate stocks rose by 1.8 million barrels.
The U.S. Energy Information Administration will release its official weekly oil supplies report at 10:30 AM ET (1430 GMT) on Wednesday. Analysts expect crude oil inventories dropped by around 3.4 million barrels at the end of last week, while gasoline supplies are seen increasing by 580,000 barrels and distillates are forecast to gain about 281,000 barrels. There are often sharp divergences between the API estimates and the official figures from EIA.
Meanwhile, investors continued to weigh the impact of diplomatic tensions between Qatar and other Middle Eastern nations, including Saudi Arabia, on an OPEC-led push to tighten the market. With oil production of about 620,000 barrels per day, Qatar's crude output ranks as one of the smallest among OPEC producers, but tension within the cartel could weaken an agreement to hold back production in order to prop up prices. Last month, OPEC and some non-OPEC producers extended a deal to cut 1.8 million barrels per day in supply until March 2018.
Concerns that the ongoing rebound in U.S. shale production could derail efforts by other major producers to rebalance global oil supply and demand remained in focus.
Elsewhere on Nymex, gasoline futures for July inched up 0.3 cents, or about 0.2%, to $1.529 a gallon, while July heating oil slipped 0.8 cents to $1.457 a gallon.
Natural gas futures for July delivery rose 1.4 cents to $3.056 per million British thermal units.