0258 GMT: Crude oil futures were lower during morning Asia trade Aug. 26 amid profit-taking and as market participants wait for signals from the upcoming Jackson Hole Symposium.

At 10:58 am Singapore time (0258 GMT), the ICE October Brent futures contract was down 29 cents/b (0.40%) from the previous close at $71.96/b while the NYMEX October light sweet crude contract was down 40 cents/b (0.59%) at $67.96/b.

"We are seeing a repeat of Wednesday morning's movement -- some profit-taking and uncertainties over the gathering optimism that the Federal Reserve will defer its tapering plan in view of the delta variant denting on economic recovery," said Vandana Hari, CEO of Vanda Insights, on Aug. 26.

However, despite the fall in oil prices, the outlook for crude oil remains positive, and analysts noted that US inventories have fallen, showing that the delta variant is having a minimal impact on oil demand.

The weekly US Energy Information Administration report released late Aug. 25 showed that total US crude inventories declined by 3 million barrels Aug. 20 from the previous week to 432.6 million barrels. US crude oil inventories were at about 6% below the five-year average for this time of year.

The draw was largely in line with market expectations. Analysts surveyed by S&P Global Platts Aug. 23 had called for a 3.2 million-barrel draw over the period.

"Crude oil gained as further drawdowns in inventories suggest demand is withstanding the outbreak of the delta variant,” an ANZ Research analyst said in an Aug. 26 note. “More encouraging was a bigger-than-expected fall in gasoline inventories, which were down 2.241 million barrels. Overall, implied gasoline demand rose 239,000 b/d to 9.572 million b/d.”

Other analysts also expressed bullishness.

"The last couple of days, everything was going right for the rebound in crude prices -- the vaccine momentum improved, an unexpected offshore platform fire shut 440,000 b/d of Mexican oil output, and the Chinese crude demand outlook is starting to look a lot better," OANDA's senior market analyst Edward Moya said Aug 26.

All eyes will be on the upcoming Jackson Hole Symposium, set to start on Aug. 26, and market watchers will be looking for signs of the US Federal Reserve possibly starting to taper its asset purchase program, which will in turn impact the strength of the dollar and movement of oil prices.

"I think crude's reversal of the mid-August selloff will hold unless there are negative surprises from the Fed, which is unlikely. The next direction will come from the OPEC+ meeting on Sept. 1," said Vandana Hari.