Oil fluctuates before U.S. inflation data as China worries linger

Oil fluctuated ahead of U.S. inflation figures that will provide clues about the prospects for the world's largest economy, while China's COVID Zero policy continues to weigh on the demand outlook.

West Texas Intermediate slipped below US$86 a barrel. China's anti-virus policies are hurting consumption, with the country now adding curbs in the southern manufacturing hub of Guangzhou.

After Brent crude rallied toward US$100 earlier this week, prices have pulled back on concerns about the demand outlook. Still, futures have regained some ground this quarter after the Organization of Petroleum Exporting Countries and its allies agreed to reduce supply, and traders are now looking ahead to U.S. inflation data due later.