Oil prices have fallen after data released by the American Petroleum Institute (API) highlighted a drop in weekly stocks was less than expected, raising worries over persistent oversupply.  

Global benchmark Brent crude LCOc1 futures traded down 49 cents at $44.38 a barrel, while the US West Texas Intermediate (WTI) crude CLc1 was down 26 cents at $42.66 a barrel, Reuters reported.

Data published by API highlighted a fall in US crude stocks by 827,000 barrels in the week ending 22 July.

"Today's weakness is just part of the general belief that the market is oversupplied."

Sources said that the industry group data showed an increase in supplies at Cushing, Oklahoma, by more than expected 1.4 million barrels.

PVM Oil Associates oil analyst Tamas Varga told the news agency: "Today's weakness is just part of the general belief that the market is oversupplied."

Investors are awaiting oil stocks data to be released by the US Government.

Other analysts said that oversupply persists while demand growth stutters and expect oil prices to decline further soon.

Statoil chief executive Eldar Saetre said that the market is expected to fall into balance over the course of this year.