LONDON (Reuters) -Oil fell for a second day on Tuesday as upbeat Chinese economic data failed to deflect the focus from a possible increase to U.S. interest rates and wider concern about the growth outlook.

Crude was also pressured by the Iraq federal government and Kurdistan Regional Government (KRG) taking a step towards a resumption in northern oil exports from the Turkish port of Ceyhan after they were halted last month.

Brent crude fell by 18 cents, or 0.2%, to $84.58 a barrel by 1336 GMT, giving up early gains. U.S. West Texas Intermediate lost 2 cents to $80.81.

“The next step may depend on global growth and whether the economy can weather the recent storm, particularly in the U.S., where tighter credit could significantly weigh on growth for the rest of the year,” said Craig Erlam of brokerage OANDA, referring to the oil price outlook.

Earlier in the session oil had found support from figures showing that China’s economy grew by a faster than expected 4.5% in the first quarter and that oil refinery throughput rose to record levels in March.

“As things stand, it’s all systems go in China, much to the relief of those betting on higher oil prices,” said Stephen Brennock of oil broker PVM.

But the prospect of another increase to U.S. interest rates, which has been supporting the U.S. dollar, remained a drag on sentiment. Traders expect the U.S. Federal Reserve to raise rates by 25 basis points at its May meeting.

The dollar eased on Tuesday after earlier gains. A stronger dollar makes commodities priced in the U.S. currency more expensive for buyers holding other currencies.

Coming into focus on Tuesday will be the latest snapshot of U.S. inventories. Analysts expect U.S. crude inventories to fall by about 2.5 million barrels and also forecast declines in gasoline and distillates.

The first of this week’s two reports, from the American Petroleum Institute, is due at 2030 GMT.