International Brent crude futures fell 16 cents, or 0.2 percent, to $78.01 a barrel.
Stephen Innes, head of trading for Asia/Pacific at futures brokerage OANDA, told Reuters that many crude futures traders were “caught long and wrong over the past 24 hours due to tropical storm buying frenzy”, adding that “prices pulled back considerably as the magnitude of the storm suggests production losses will be limited.”
Asian shares dropped in early trading on Wednesday tracking a retreat on Wall Street overnight.
MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.5 percent.
MSCI’s gauge of stocks across the globe dropped about 0.5 percent on Tuesday, as trade tensions kept weighing on investor sentiment.
“The U.S.-Canada talks are due to resume today and this keeps trade issues at the forefront, with a wait-and-see mood prevailing in the equity markets,” Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management in Tokyo, told Reuters.
“Then there is the U.S.-China trade issue, in addition to turbulence in the emerging market currencies that the markets have to worry about,” Ichikawa at Sumitomo Mitsui Asset Management said.
Middle East markets
Abu Dhabi’s stock market gained 0.9 percent on Tuesday after Abu Dhabi Commercial Bank (ADCB), the emirate’s second largest bank, and Union National Bank surged in early trading on the Abu Dhabi stock market, following confirmation the lenders were in preliminary talks to merge.
The bank added that “similar and separate discussions have also commenced with the shareholders of Al Hilal Bank,” ADCB announced in a statement issued to the Abu Dhabi Securities Exchange.
ADCB stocks surged 12.8 percent to eight dirhams a share, the highest since August 2015. UNB jumped 14.8 percent to 4.43 dirhams, the highest since March this year.
Dubai’s index added 0.3 percent as Damac Properties added 0.5 percent. Emaar Development, a unit of Dubai property firm Emaar Properties, was up 1.9 percent. Dubai-based contractor Drake & Scull International was up 4.4 percent.
Saudi Arabia’s index added 0.3 percent. Shares in Saudi Real Estate Co jumped 6.6 percent after the company said it had signed a framework agreement with the Presidency of State Security.
Qatar’s index added 0.2 percent, Egypt’s index added 0.64 percent, Kuwait’s index gained 1 percent, while Bahrain’s index rose 0.3 percent and Oman’s index was flat.
The dollar index edged down from a two week high of 95.737 reached on Tuesday and was trading early on Wednesday near 95.36.
The dollar had drawn strength on Tuesday from upbeat U.S. indicators supporting the case for further interest rate hikes by the Federal Reserve.
The euro was 0.15 percent higher at $1.1599 following a loss of 0.35 percent on Tuesday.
Gold prices were trading near one-week low early on Wednesday as the dollar remained strong despite the greenback trading a touch lower.
Spot gold was little changed at $1,191.45 percent at 0102 GMT, after touching a more than one-week low at $1,189.20 on Tuesday.
U.S. gold futures were down 0.1 percent at $1,197.90 an ounce.
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(Writing by Gerard Aoun; Editing by Mily Chakrabarty)
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