Brent for September settlement, which expires today, fell 24 cents to US$74.73 a barrel on the London-based ICE Futures Europe exchange.
RIG-OL-USA-BHI Hedge funds trimmed their bullish wagers on US crude for the second week in a row to the lowest in almost a month, data also showed on Friday, as oil prices remained volatile amid trade tensions and geopolitical risks. It has rebounded to above $70 a barrel since April as the Opec cartel, which pumps a third of the world's crude, cut supplies to bring the market back into balance.
"Oil prices, which were on the rise on concerns of tightening supply, and growing desperation that the loss of Iranian oil supplies would not be easily replaced, may have found a ray of hope", he said in a daily emailed market report. "It is the impact of the USA sanctions on Iran that will decide the next $15 a barrel", PVM Oil Associates Tamas Varga said in a note.
Futures for September delivery climbed 0.8 percent to 514 yuan a barrel on the Shanghai International Energy Exchange.
Stocks at the Cushing storage hub fell to 23.7 million barrels, the lowest since November 2014 in the week to July 20.
Further increases in supplies would compensate for production disruption in some areas and absorb the impact of price pressures.
The Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC countries agreed to raise supply in a meeting last month to meet rising global demand, but the group did not specify a clear target for the output increase.
Saudi tankers altered course after the kingdom last week took the extraordinary measure of temporarily halting oil shipments via the Bab el-Mandeb Strait at the southern tip of the Red Sea.More news: Upcoming iPad Pro to lose bezels and headphone jack this year
Oil prices CLc1 LCOc1 pared losses briefly after the data, but were still trading about 1 percent lower on the day.
"Prices shed some of yesterday's gains overnight", said Carsten Fritsch, an analyst at Commerzbank AG in Frankfurt.
OPEC has promised to increase supply in order to make up for any shortfalls from Iranian supply (following U.S. sanctions).
Though a shortage of pipelines persists in the Permian Basin of West Texas and New Mexico, domestic crude production is hovering near a record 11 million barrels a day, according to the latest Energy Information Administration data.
Crude oil prices softened ahead of the start of USA trading Tuesday on possible wiggle room in Iran and steady personal incomes in the United States.
"There's been this rush to put more oil on the market by the Saudis and Russian Federation, so I think in the near term, it's a negative because we haven't lost any of the Iranian barrels yet", Kilduff said.
Exports fell as returning US sanctions discouraged companies from buying the country´s oil.
The market largely overlooked reports that US and China may restart negotiations to defuse the trade war between the two countries.