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Oil prices edged higher on Tuesday, rebounding more than 1% following a sharp selloff that pushed crude to near four-year lows. The recovery was supported by a modest bounce in global equity markets, though analysts caution that downside risks remain due to escalating U.S.-China trade tensions and fears of a global economic slowdown.
By 05:35 GMT, Brent crude futures rose 72 cents, or 1.1%, to $64.93 per barrel, while U.S. West Texas Intermediate (WTI) crude climbed 75 cents, or 1.2%, to $61.45.
Both benchmarks had slumped between 14% and 15% since U.S. President Donald Trump announced a sweeping tariff plan on April 2, targeting all imports with reciprocal duties—a move that rattled financial markets and sparked concerns of a looming recession that could weigh heavily on oil demand.
U.S.-China Standoff Intensifies
With China unlikely to yield to U.S. demands, analysts fear a further escalation in the trade conflict is inevitable, adding more pressure on oil markets and the broader global economy.
Beijing has reaffirmed its resolve to resist what it describes as U.S. economic blackmail, while stepping up efforts to stabilize its capital markets.
Trump, meanwhile, has defended the tariffs, saying they are necessary to revive the U.S. industrial base, which he claims has been hollowed out by decades of trade liberalization.
Inventory Data in Focus
Adding to bearish sentiment, a Reuters poll released Monday forecast that U.S. crude oil and distillate inventories rose by about 1.6 million barrels last week, reinforcing market expectations of weakening demand.
The American Petroleum Institute (API) will release its weekly inventory report later Tuesday, followed by official data from the Energy Information Administration (EIA) on Wednesday.
If the data confirms rising stockpiles amid softening demand, it could further limit oil’s recovery and signal deeper trouble for energy markets in the weeks ahead.
Despite Tuesday’s slight rebound, oil prices remain under pressure from trade-related uncertainty, weak macroeconomic signals, and rising inventories—all of which suggest that any recovery may be short-lived unless geopolitical tensions ease.
