Oil prices rose 1% on Tuesday, helped by weakness in the US dollar, although gains were capped as concerns mounted over a US slowdown and the impact of trade tariffs on global economic growth.
Brent futures rose 73 cents, or 1.05%, to stand at$70.01 a barrel at 1116 GMT after falling in early trade. US West Texas Intermediate crude futures climbed 66 cents, or 1%, to $66.69 a barrel after previous declines as well.
Both benchmarks closed 1.5% lower in the previous session.
The dollar index hit a four-month low, making oil less expensive for overseas buyers.
Investors are closely monitoring OPEC+ plans after the producer group announced plans to increase output in April, Reuters reported.
A scaling back of US tariffs would ease fears of inflation and economic contraction, said PVM analyst Tamas Varga, but the recent oil price plunge meant it was “hard to see OPEC+ going ahead with its plan and releasing oil back to the market from April.”
On Friday, Russia’s Deputy Prime Minister Alexander Novak told reporters that the OPEC+ producer group would go ahead with its April increase but may then consider other steps, including reducing production.
Brent is finding strong technical support at around $70 a barrel and may look to stage a bounce, said Suvro Sarkar, energy sector team lead at DBS Bank, adding that the OPEC+ supply response would be flexible, depending on market conditions.
“If oil prices fall below the $70 per barrel mark for an extended period, output hikes may be paused in our opinion. OPEC+ will also keep a careful eye on Trump’s Iran and Venezuela policies,” he said.
US President Donald Trump’s protectionist policies have shaken global markets, imposing and delaying tariffs on major oil suppliers Canada and Mexico, while also raising duties on China, prompting retaliatory measures.
Over the weekend, Trump said a “period of transition” was likely and declined to rule out a US recession.
Stocks, which crude prices often follow, slumped on Monday, with all three major US indexes suffering sharp declines. The S&P 500 had its biggest one-day drop since December 18 and the Nasdaq slid 4.0%, its biggest single-day percentage drop since September 2022.
Investors await US inflation data due on Wednesday for clues on the path of interest rates.
In the US, crude oil stockpiles were expected to have risen last week, while distillate and gasoline inventories likely fell, a preliminary Reuters poll showed on Monday.
The poll was conducted ahead of reports from the American Petroleum Institute at 4:30 p.m. EDT Tuesday and the Energy Information Administration at 10:30 a.m. EDT Wednesday.
