08:38 AM EDT, 07/04/2024 (MT Newswires) -- Oil prices weakened in light U.S.-led holiday trade early on Thursday, falling off a near seven-week high set after a report showed U.S. oil inventories last week fell by the most in a year.

West Texas Intermediate crude oil for August delivery was last seen down US$0.53 to US$83.35 per barrel, while September Brent crude, the global benchmark, was down US$0.48 to US$86.86.

Prices rose to the highest since mid April on Wednesday as the dollar fell amid weak U.S. economic data and the Energy Information Administration reported oil inventories fell by 12.2-million barrels last week, the largest drop since last July.

"In addition to the weak dollar the long-awaited improvement in the summer demand outlook was the other factor that incentivized the rally, and it came disguised as the weekly US stock report from the EIA. As refiners stepped on the accelerator and because of healthy exports reading crude oil stocks plummeted 12.1 million bbls," PVM Oil Associates noted.

Hurricane Beryl continues to track through the southern Gulf of Mexico, weakening to a category 3 storm with wind speeds of 120 miles per hour according to the National Hurricane Center. The storm is expected to arrive on Mexico's Yucatan peninsula on Friday but remains well south of U.S. oil platforms in the northern gulf.