Oil fell for a third session amid weak European economic data

Oil prices were nearly flat at the start of trading on Wednesday, as signs of shrinking US supplies were counterbalanced by economic data that weakened expectations for energy demand.

Brent crude futures rose two cents to $88.09 a barrel by 0003 GMT, while US West Texas Intermediate crude futures fell five cents to $83.69 a barrel.

Record prices fell in each of the previous three sessions.

Market sources, citing figures from the American Petroleum Institute, reported on Tuesday that US crude supplies decreased by about 2.7 million barrels in the week ending October 20. This contradicts the average opinion of eight analysts polled by Reuters, who estimated that crude inventories increased by about 200,000 barrels per week.

The US government is scheduled to release inventory data later on Wednesday.

Meanwhile, business activity data in the eurozone surprisingly fell this month, indicating that the bloc may slide into recession, which would negatively impact the outlook for oil demand.

Investors are also watching the Middle East region, as traders fear that the expansion of the conflict there will lead to turmoil in oil markets and disrupt supplies.

Countries, including the United States, Canada, Russia and Arab countries, are pressing to end the fighting between Israel and Hamas in the Gaza Strip or a ceasefire so that humanitarian aid can be delivered to besieged Palestinian civilians.