Oil dips on concerns of delay in US-China trade deal until next year

Oil prices retreated on Thursday after gaining more than 2% in the previous session on bullish U.S. crude inventory data, as a fresh spat over Hong Kong fuelled concerns of a further delay in any U.S.-China trade deal.

The trade war between the world's two biggest economies has hit global growth prospects and dominated the outlook for future oil demand.

Trade experts have warned the first phase of a trade deal could slide into next year, while markets are wary negotiations might take a hit as the U.S. House of Representatives passed two bills to back protesters in Hong Kong, much to the disapproval of China.

Brent crude futures fell 20 cents, or 0.32%, to $62.20 a barrel by 0330 GMT. The international benchmark rose 2.5% on Wednesday.

West Texas Intermediate (WTI) crude futures dropped 17 cents, or 0.3%, to $56.84 per barrel. U.S. crude closed up 3.4% in the previous session.

U.S. President Donald Trump said he is inclined to raise tariffs on Chinese imports if a trade deal is not reached.

A smaller-than-expected build in weekly U.S. inventories, however, propelled oil prices higher on Wednesday.

Crude stocks at the U.S. delivery hub of Cushing, Oklahoma fell by 2.3 million barrels, while U.S. crude stocks rose by 1.4 million barrels in the week to Nov. 15, compared with expectations for an increase of 1.5 million barrels, data from the Energy Information Administration showed.