Oil prices edged lower on Wednesday, giving up early gains amid concerns that high inflation may trigger more rate hikes from different central banks in the near term.
There is lot of talk about stagflation, in which prices surge while economic growth stalls.
Benchmark Brent crude futures dropped 0.3 percent to $82.28 a barrel, while West Texas Intermediate crude futures were down 0.2 percent at $78.78.
The dollar surged and equity markets across Asia and Europe fell as investors weighed the outlook for economic growth against the backdrop of soaring energy prices, the debt crises of Chinese property developers and the impasse in the U.S. Congress on raising the debt ceiling.
Meanwhile, the American Petroleum Institute reported a rise in U.S. crude stockpiles, raising fresh concerns over slowing fuel demand.
Late Tuesday, the industry group said U.S. crude inventories rose by 951,000 barrels in the week to Oct. 1. Gasoline and distillate fuel inventories also climbed.
Official inventory numbers from the Energy Information Administration will be out later in the day.
Saudi Aramco, which says the gas crunch is already boosting oil demand, cut nearly all of its November official selling prices for Asia, Mediterranean, European and U.S.-bound cargoes.