SINGAPORE- Oil gained more than $1 per barrel on Tuesday, rebounding on technical factors and bargain hunting after a decision by OPEC+ to boost output sent prices down the previous session, although concerns about the market surplus outlook persisted.
Brent crude futures rose $1.15 to $61.38 a barrel, the first time gain after six consecutive declines, while US West Texas Intermediate crude added $1.11 to $58.24 a barrel.
Both benchmarks had settled at their lowest since February 2021 on Monday, driven by an OPEC+ decision over the weekend to further speed up oil production hikes for a second consecutive month.
“Today’s slight rebound in oil prices appears more technical than fundamental,” said Yeap Jun Rong, a market strategist at IG. “Persistent headwinds including a pivotal shift in OPEC+ production strategy, uncertain demand amid US tariff risks, and price forecast downgrades are continuing to weigh on the broader price movement.”
Driven by expectations that production will exceed consumption, oil has lost over 10 percent in six straight sessions and dipped over 20 percent since April when US President Donald Trump’s tariff shocks prompted increased bets on a slowdown in the global economy.
The return of Chinese market participants after a five-day public holiday since May 1 was seen supporting prices on Tuesday.
“China also reopened today, and being the largest importer, buyers would have likely jumped to secure oil at current low levels,” said Priyanka Sachdeva, senior market analyst at Phillip Nova.
Also lending some support was data showing a pick-up in services sector’s growth in the US, the world’s major oil consumer, as orders increased.
