Brent North Sea crude for delivery in April slid 39 cents to USD 110.08 per barrel in London late afternoon trading.
New York's main contract West Texas Intermediate (WTI) for March dipped six cents to USD 103.25 a barrel.
The US government's Department of Energy (DoE) revealed today that American commercial crude inventories rose 1.0 million barrels in the week ending February 14.
That was less than market expectations for a gain of 1.8 million, indicating stronger-than-expected demand.
Distillates reserves, which include diesel and heating fuel, slid by 300,000 barrels.
The weekly stocks data in top global crude consumer the US was issued one day later than usual due to Monday's public holiday.
The oil market was meanwhile hit Thursday by poor economic numbers out of China, which is the world's second biggest crude consumer.
A closely-watched index showed today that China's key manufacturing sector contracted further in February.
"Chinese manufacturing activity figures showed the slowest growth in seven months, while employment figure fell at the fastest pace in five years," said analyst Lucy Sidebotham at British-based energy consultancy Inenco.
British banking giant HSBC's preliminary reading for its purchasing managers' index (PMI) for China, which tracks manufacturing activity in factories and workshops, fell to 48.3 this month.
That marked a further tumble from the final reading of 49.5 in January, when the figure showed contraction for the first time in six months.
"The price took a hit after Chinese manufacturing data came out weaker than expected for the past seven months which triggered profit taking from investors," said Nicholas Dale-Lace, senior sales trader at CMC Markets.