Oil prices were higher on Tuesday, bouncing back from three sessions of declines triggered by pessimism around global growth, as investors shifted their focus back to OPEC supply cuts and expectations of lower U.S. inventories.
“It appears that concerns about demand have taken something of a back seat,” Commerzbank (DE:CBKG) analyst Carsten Fritsch said. “Instead, market participants are focusing on the tight supply situation again.”
OPEC, which together with some non-affiliated producers like Russia, known as 'OPEC+', agreed late last year to reduce output by 1.2 million barrels per day (bpd) to remove a glut and prop up prices.
Further price support came from another power cut in Venezuela, the second to hit the OPEC nation this month, raising concern about the country’s oil exports.
U.S. West Texas Intermediate crude futures jumped $1.35, or around 2.3%, to $60.19 a barrel by 8:40AM ET (12:40 GMT), within sight of a four-month peak of $60.39 reached last week.
Elsewhere, Brent oil rose 86 cents, or about 1.3%, to $67.67 a barrel.
Oil prices were hammered over the past few trading sessions following the Federal Reserve's stunning about-face on interest rate increases and data that suggested slowing global growth.
Adding to the worries was the inversion of the U.S. Treasury yield curve, seen by many as a recession indicator.
Market players now looked ahead to the release of fresh weekly data on U.S. commercial crude inventories.
The American Petroleum Institute is due to release its weekly report for the week ended March 22 at 4:30PM ET (20:30 GMT), amid expectations of a decline of about 2.4 million barrels.
The U.S. Energy Information Administration's weekly report will be released on Wednesday.
In other energy trading, gasoline futures gained 1.2% to $1.913 a gallon, while Heating Oil ticked up 0.8% at $1.997 a gallon.
Natural gas futures dipped 0.3% to $2.764 per million British thermal units.
-- Reuters contributed to this report
