Oil prices slid on Thursday over weak demand data in the US and unfolding fears that recession signs in China will also curb the country's oil demand.
International benchmark crude Brent traded at $80.78 per barrel at 10.59 a.m. local time (0759 GMT), a 0.49% fall from the closing price of $81.18 a barrel in the previous trading session on Wednesday.
The American benchmark, West Texas Intermediate (WTI), traded at the same time at $75.83 per barrel, down 1.08% from Wednesday's close of $76.66 per barrel.
Both benchmarks continued their downward trend during early Asian trade over signs of weakening oil demand in the two largest oil-consuming countries, the US and China.
According to the Energy Information Administration (EIA), US commercial crude oil inventories increased by around 3.6 million barrels to 439.4 million barrels, compared to the American Petroleum Institute's expectation of a rise of around 1.3 million barrels.
Furthermore, a report released Wednesday revealed that the New York Fed manufacturing index in November climbed to its highest level since April, exceeding market estimates.
The Empire State Manufacturing Index, which gauges New York's overall business conditions, jumped by 13.7 points this month from -4.6 points in October to 9.1 points, well above forecasts, according to the Federal Reserve Bank of New York.
The market index had been anticipated at -2.8 points. Readings above zero indicate improving conditions, while those below show worsening conditions.
Analysts predict that the Fed will keep interest rates constant at the December meeting, based on pricing in financial markets, but expect the bank to start cutting interest rates in June next year.
The President of the Federal Reserve Bank of San Francisco, Mary Daly, described the latest inflation numbers as "very encouraging" and hinted at "further interest rate hikes" as the central bank continues its fight against inflation.
Recession fears in China put pressure on prices
Despite government intervention, house prices in China's major cities—the country that is both the world's largest oil importer and second-largest oil consumer—saw the biggest drop in more than nine years in October. The oil market is also affected by this weak data, with a fall in demand leading to lower pricing.
However, recent OPEC and International Energy Agency reports showing positive forecasts regarding the Chinese economy and oil demand outlook eased these concerns and limited further price downticks.