Brent crude futures lost 82 cents, or 0.76%, to trade at $106.95 a barrel, and US West Texas Intermediate futures fell 66 cents, or 0.65%, to $101.52.

Both benchmarks have largely hovered around or above the $100 ​per barrel mark since the US and Israel began attacks on Iran at the end of ​February, and Tehran effectively shut the Strait of Hormuz.

Oil prices rose by over 3% on Tuesday, extending earlier gains as hopes for a lasting US-Iran ceasefire faded, dimming prospects of reopening the Strait of Hormuz, through which about a fifth of global oil and liquefied natural gas normally flows.

Trump said on Tuesday he does not ​think he will need China’s help to end the war with Iran, even as hopes for a lasting peace deal dwindled and Tehran tightened its grip over the strait.

China is the biggest buyer of Iranian oil despite pressure from the Trump administration. Trump meets ​his Chinese counterpart, Xi, in Beijing on Thursday and Friday.

“The length of the disruption and the scale of ​the supply loss - already more than 1 billion barrels - means oil prices are likely to remain above $80 per barrel for the ‌rest ⁠of the year,” Eurasia Group said in a client note.

The war with Iran has started to take its toll on the US economy, the world’s biggest, as higher oil prices lead to more expensive fuels, and economists expect to see second-round effects in the months ahead.

In April, US consumer prices rose sharply for a second straight month, resulting ​in the largest annual ​increase in inflation in ⁠nearly three years, bolstering expectations that the Federal Reserve would keep interest rates flat for a while.

“The marked increase in inflation across advanced economies has yet to cause ​real spending to contract, but the widespread decline in consumer sentiment and hiring intentions ​points to worse ⁠to come,” Capital Economics said in a client note.

Elevated interest rates make borrowing more expensive, potentially denting oil demand.

As the Iran war continues, US crude oil inventories fell for a fourth straight week last week, and distillate ⁠inventories also ​declined, according to market sources citing American Petroleum Institute data.

Official inventory data ​from the US Energy Information Administration, the statistical arm of the US Department of Energy, is due at 10:30am ET on ​Wednesday, with a Reuters poll also predicting a decline in stockpiles.