Oil prices edged higher on Tuesday, reversing some of the previous session’s losses, as the U.S. dollar eased, while weaker U.S. business activity data lowered expectations for more aggressive interest rate hikes in the world’s biggest economy.
International benchmark Brent crude futures gained 12 cents to $93.38 per barrel by 0008 GMT, while U.S. West Texas Intermediate crude futures rose 22 cents to $84.80 per barrel.
U.S. business activity contracted for a fourth straight month in October, with manufacturers and services firms in a monthly S&P Global survey of purchasing managers both reporting weaker client demand.
That weakening could indicate that the U.S. Federal Reserve’s interest rate increases to fight inflation have been working and may persuade it to slow its rate hike policies, a positive signal for fuel demand.
Meanwhile, the U.S. dollar index edged lower in early trade. A weaker dollar makes oil less expensive for non-U.S. buyers.
Limiting gains, China’s September crude imports of 9.79 million barrels per day were 2% below a year earlier, customs data showed on Monday, as independent refiners curbed throughput amid thin margins and lackluster demand.