Oil prices edged down on Thursday after a surge in the previous session on a larger than expected draw in U.S. gasoline stocks, as markets weighed prevailing macroeconomic concerns against firm near-term demand expectations.

Brent futures were down three cents to $70.92 a barrel at 0704 GMT, while U.S. West Texas Intermediate crude futures were down eight cents to $67.60 a barrel.

Both benchmarks rallied about two percent on Wednesday as U.S. government data showed tighter than expected oil and fuel inventories.

U.S. gasoline inventories fell by 5.7 million barrels, more than the 1.9 million-barrel draw expected by analysts, while distillate stocks also dropped more than anticipated - despite gains in crude stocks.

"Declining U.S. gasoline inventories raised expectations for a seasonal demand increase in spring, but concerns about the global economic impact of tariff wars weighed on the market," said Hiroyuki Kikukawa, chief strategist of Nissan Securities Investment.

"With strong and weak factors progressing simultaneously, it has become difficult for the market to lean decisively in one direction or the other," he added.

Donald Trump threatened on Wednesday to escalate a global trade war with further tariffs on European Union goods, as major U.S. trading partners said they would retaliate for trade barriers already erected by the U.S. president.

Trump's focus on tariffs has rattled investors, consumers and business confidence, and raised U.S. recession fears.

Meanwhile, the Organization of the Petroleum Exporting Countries said on Wednesday that Kazakhstan led a sizeable jump in February crude output by the wider OPEC+, highlighting a challenge for the producer group in enforcing adherence to agreed output targets.

Worries about flagging jet fuel demand weighed further on markets, with JP Morgan analysts saying that U.S. Transportation Security Administration data showed "passenger volumes for March have decreased by five-percent year-over-year, following stagnant traffic in February".

However, recent firm global demand numbers limited overall market weakness.

"As of March 11, global oil demand averaged 102.2 million barrels per day, expanding 1.7 million barrels per day year-over-year and exceeding our projected increase for the month by 60,000 barrels per day," they added.