Oil headed for the biggest two-day drop since July, with fuels from diesel to gasoline also declining as fears over a worsening trade war rattled markets across the board.

NEW YORK (Reuters) - Brent crude futures gave back early gains and turned lower on Friday after the International Energy Agency (IEA) deemed supply adequate and the outlook for demand weakening, while U.S. crude steadied as equities rebounded.

Oil slipped to a one-week low amid signs that Iranian supply disruptions may not be as severe as expected.

U.S. stocks tumbled the most since February as fresh concern about the impact of the trade war with China roiled technology and industrial shares. Treasuries rose with the yen amid demand for haven assets.

Irving Oil Corp.’s refinery in New Brunswick, a major supplier of fuel to the northeastern U.S., was shut after an explosion and fire in a diesel unit.

Crude traded near $74 a barrel as storm Michael in the U.S. strengthened and shut some oil output, while American inventories were predicted to have risen for a third week.