Oil prices slipped on Thursday after a surge in the previous session on a larger-than-expected draw in U.S. gasoline stocks, as markets weighed macroeconomic concerns against firm near-term demand.

Brent futures fell 5 cents to $70.9 a barrel by 0426 GMT, while U.S. West Texas Intermediate crude futures shed 10 cents to $67.58 a barrel.

Both benchmarks rallied about 2% on Wednesday as U.S. government data showed tighter-than-expected oil and fuel inventories.

U.S. gasoline inventories fell by 5.7 million barrels, more than the 1.9 million-barrel draw expected by analysts, while distillate stocks also dropped more than anticipated - despite gains in crude stocks. [EIA/S]

"Declining U.S. gasoline inventories raised expectations for a seasonal demand increase in spring, but concerns about the global economic impact of tariff wars weighed on the market," said Hiroyuki Kikukawa, chief strategist of Nissan (OTC:NSANY) Securities Investment.

"With strong and weak factors progressing simultaneously, it has become difficult for the market to lean decisively in one direction or the other," he added.

Donald Trump threatened on Wednesday to escalate a global trade war with further tariffs on European Union goods, as major U.S. trading partners said they would retaliate for trade barriers already erected by the U.S. president.

Trump's hyper-focus on tariffs has rattled investors, consumers and business confidence and raised U.S. recession fears.

Meanwhile, the Organization of the Petroleum Exporting Countries said on Wednesday that Kazakhstan led a sizeable jump in February crude output by the wider OPEC+, highlighting a challenge for the producer group in enforcing adherence to agreed output targets.

Source: Investing.com