Oil prices fell in early Asian trading on Thursday after a surprise increase in U.S. inventories heightened concerns about slowing demand in the world's biggest oil consumer, but worries that a possible widening of the Gaza war could disrupt Middle East supplies limited the declines.
Brent crude futures fell 30 cents, or 0.4 percent, to $84.17 a barrel by 0028 GMT. U.S. West Texas Intermediate (WTI) crude futures fell 32 cents, or 0.4 percent, to $80.58 a barrel.
The two benchmarks had recorded a slight increase at settlement yesterday, Wednesday.
The US Energy Information Administration said the country's crude oil inventories rose by 3.6 million barrels last week, surprising analysts polled by Reuters who had expected a 2.9 million barrel decline.
U.S. gasoline inventories also rose by 2.7 million barrels, compared to analysts' expectations for a 1 million-barrel decrease.
In the Middle East, escalating cross-border tensions between Israel and the Lebanese Hezbollah group in recent weeks have raised fears of a full-scale war between Israel and Hezbollah.
Turkish President Recep Tayyip Erdogan said his country stands in solidarity with Lebanon and called on regional countries to support Beirut as well.
Meanwhile, Israeli forces bombed several areas across Gaza on Wednesday, and residents reported heavy clashes overnight in Rafah at the southern tip of the strip.
