Crude oil futures pared early gains and settled lower on Thursday, snapping a three-day winning streak, as the dollar advanced on rate hike bets.
Fears about the Fed continuing with its interest rate hikes, and a surge in Covid-19 cases in China raised concerns about the outlook for energy demand, outweighing recent data showing a drop in crude inventories.
U.S. economic activity unexpectedly jumped more than previously estimated in the third quarter, according to revised data released by the Commerce Department.
The report showed the surge in real gross domestic product in the third quarter was upwardly revised to 3.2% from the previously reported 2.9%. Economists had expected the pace of GDP growth to be unrevised.
The stronger than previously estimated growth in the third quarter came after GDP slumped by 1.6% in the first quarter and fell by 0.6% in the second quarter.
West Texas Intermediate Crude oil futures for February ended $0.80 at $77.49 a barrel, falling from a high of $79.90 a barrel.
Brent crude futures were down $0.79 or 0.96% at $81.41 a barrel a little while ago.
Prices rose earlier in the session on inventory data, and news that a powerful winter storm will bring "dangerous cold," heavy snow and flash freezing across the central and eastern U.S. through the rest of the week.
"A strong winter storm will form on this front with blizzard conditions," the National Weather Service tweeted. The severe weather might cause travel chaos and power outages across the U.S.
Data from Energy Information Administration (EIA) showed crude inventories in the U.S. fell by 5.89 million barrels last week, more than 3.5 times the estimated decline of 1.66 million barrels.
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