The abduction of five crew members from a Swedish boat in Nigeria's oil-producing Niger delta region highlighted the risks to supply in the African nation, a major supplier to the U.S. Earlier in the week, Nigerian militants threatened to blow up pipelines in the region within a month.

Investors are also watching for any signs in increased tension between Iran and the West.

Although supply concerns have taken a back seat to demand over the past two weeks, analysts note that prices could rebound, on even a temporary cut to supply.

"There is a palpable sense of exhaustion amongst traders after the steep sell-off of the past two weeks, and many think we are in for a period of stabilization," said Addison Armstrong, director of market research at Tradition Energy. "This notion is being supported by renewed concerns about events in Nigeria and the Middle East."

In other Nymex trading, heating oil futures fell 2.18 cents to $3.5453 a gallon while gasoline futures lost 2.54 cents to $3.034 a gallon. Natural gas prices sank 15.3 cents to $9.17 per 1,000 cubic feet.

In London, September Brent crude fell $1.46 to $125 a barrel on the ICE Futures exchange.