Oil futures were mixed on Wednesday as concerns about oversupply in the market, stoked by a rise in US crude inventories, were offset by a drop in gasoline stocks that lifted hopes for fuel demand recovery amid the re-opening of the global economy.

Brent crude was up 12 cents, or 0.3 per cent, at $42.75 a barrel by 0643 GMT, after falling to $42.30 earlier in the session.

US West Texas Intermediate (WTI) crude futures fell 1 cent to $40.34 a barrel, paring some of its earlier losses. US crude inventories rose by a much bigger than expected 1.7 million barrels last week, according to industry group the American Petroleum Institute (API), well ahead of analysts' expectations for a 300,000-barrel build.

However, US gasoline and distillate inventories fell, the data showed, feeding optimism that fuel consumption is picking up as some economies ease lockdowns imposed to contain the coronavirus pandemic.

US government data will be released on Wednesday.

“Some investors took profits after the recent rally as they saw higher US crude stockpiles,” Chiyoki Chen, chief analyst at Sunward Trading said.

On Tuesday, both Brent and WTI contracts traded at their highest levels since prices collapsed in early March.

Global oil consumption has started to recover as economies emerge from lockdown, while the Organization of the Petroleum Exporting Countries (OPEC) and allied producers - a grouping known as OPEC+ - have slashed output and US shale producers have shut in wells.

Still, the market remains concerned about a rising number of coronavirus cases in the US and elsewhere, said Kazuhiko Saito, chief analyst at Fujitomi Co.

New cases of Covid-19 rose 25 per cent in the US nited States in the week ended June 21 and the death toll in Latin America passed 100,000 on Tuesday, according to a Reuters analysis and tally.

China, the world's top crude importer, is also expected to slow crude imports in the third quarter, after record purchases in recent months, as higher oil prices hurt demand and refiners worry about a second virus outbreak.

“We expect Brent to be traded between $35-45 a barrel for the next week as concerns over a second wave of the coronavirus pandemic will limit gains, while reduced supply from OPEC+ will lend support,” Sunward's Chen said.