Brent crude futures were down 8 cents, or 0.13 percent, to $62.06 a barrel.
U.S. West Texas Intermediate crude fell 23 cents, or 0.43 percent, to $53.65 a barrel. On Tuesday, it had recorded its biggest daily rise since early January.
After weeks of swelling, U.S. crude stocks fell by 3.1 million barrels in the last week compared with analysts’ expectations for a draw of 1.1 million barrels, the Energy Information Administration said.
“Even with the bullish report, after the big run-up yesterday, the market is hesitant to drive a lot higher,” said Phil Flynn, analyst at Price Futures Group in Chicago.
Oil supply was drawn down more than expected but the bigger story in this morning’s EIA report appears to be the surge in gasoline demand as the summer driving season kicks into high gear, according to both John Kilduff of Again Capital and Andy Lipow of Lipow Oil Associates.
Demand was a record for the weekly data, at 9.9928 million barrels a day last week. That is up from the 9.3 million barrels a day drivers used a year ago. It was also up from 9.877 million barrels a day last week.
“With the economy chugging along, people are taking lots of driving vacations and that supports demand for a gasoline,” said Lipow. “That should be the case this summer as gasoline prices have fallen off from their peak from earlier this year.”
Comments by U.S. President Donald Trump that preparations were starting for him to meet Chinese President Xi Jinping next week at the G20 summit in Osaka, Japan, also helped oil prices.
Trump has repeatedly threatened to slap more tariffs on Chinese goods.
Tensions remain high in the Middle East after last week’s tanker attacks. Fears of a confrontation between Iran and the United States have mounted, with Washington blaming Tehran, which has denied any role.
Trump said he was prepared to take military action to stop Iran having a nuclear bomb but left open whether he would approve the use of force to protect Gulf oil supplies.
On Wednesday, oil markets shrugged off a rocket attack on a site in southern Iraq used by foreign oil companies.
“It is interesting to note that the crude oil futures market could not rally on hawks planting bombs in the Strait of Hormuz but could rally on doves planting quantitative easing,” Petromatrix’s Olivier Jakob said in a note.
“This is an oil market that doesnt know how to react when an oil tanker blows up but knows how to react when the head of a central bank makes some noise.”
The U.S. Federal Reserve concludes its latest two-day policy meeting on Wednesday and is expected to leave interest rates on hold but flag whether it plans to cut rates later this year. The Fed may nod to recent weaker-than-expected jobs numbers and softer inflation, and drop from its policy statement a pledge to be “patient” before changing rates.
Members of the Organization of the Petroleum Exporting Countries have agreed to meet on July 1, followed by a meeting with non-OPEC allies on July 2, after weeks of wrangling over dates.
OPEC and its allies will discuss whether to extend a deal on cutting 1.2 million barrels per day of production that runs out this month.
— CNBC’s Patti Domm contributed to this report.