Brent crude futures fell 6 cents to $84.41 a barrel. US West Texas Intermediate crude was down 21 cents, or 0.3%, at $81.91 a barrel, Reuters reported.
China, the world's second-biggest oil consumer, has suspended some international flights and stepped up efforts to rein in a virus outbreak at Tianjin while the highly transmissible Omicron variant has spread to the northeastern city of Dalian.
Many cities have also urged people to stay put during the Lunar New Year holiday, which could cool demand for transport fuel during a peak travel season.
The world's top oil importer also posted in 2021 its first annual decline in crude oil shipments in two decades as Beijing clamped down on the refining sector and drew down massive inventories, although traders expect imports to recover this year.
The US Energy Department said on Thursday it had sold 18 million barrels of strategic crude oil reserves to six companies, including Exxon Mobil and a unit of refiner Valero Energy Corp.
Nevertheless, Brent and WTI prices are set to climb for a fourth week in a row, supported by supply and geopolitical concerns in Libya and Kazakhstan, and a drop in US crude inventories to 2018 lows.
Some investors are also optimistic that Omicron's impact on the global economy and oil demand will be short-lived.
Several banks have forecast oil prices to hit $100 a barrel later this year, as demand is expected to outstrip supply.