Oil prices open lower on dollar strength, profit-taking

Oil prices slipped in early Asian trade on Thursday, extending the previous session's losses, as the dollar strengthened and on profit-taking after U.S. crude oil stocks fell less than expected.

Brent futures dipped 14 cents, or 0.2 per cent, to $79.32 a barrel by 0001 GMT, while U.S. West Texas Intermediate (WTI) crude fell 15 cents to $75.20 a barrel.

Strength in the U.S. dollar index (.DXY) weighed on prices. The dollar bounced on Wednesday after sentiment was boosted by inflation in the United Kingdom falling more than expected in June to its slowest pace in more than a year at 7.9 per cent.

A stronger greenback makes crude more expensive for investors holding other currencies.

Also weighing on sentiment, U.S. crude inventories fell by 708,000 barrels in the last week to 457.4 million barrels, compared with analysts' expectations in a Reuters poll for a drop of 2.4 million barrels, Energy Information Administration data showed on Wednesday.

On the demand side, the market is waiting to see what steps China takes to boost growth after its top economic planner pledged on Tuesday to roll out policies to "restore and expand" consumption in the world's second-largest economy.