Crude oil prices rebounded and rose on Tuesday in a volatile trading session, even as Ukraine and Russia headed for peace talks and demand concerns remain as China shut down its financial hub in Shanghai to curb the surge in coronavirus cases.
While the benchmark Brent crude oil price fell early on Tuesday, extending losses from the previous session, it rebounded and was last up nearly 0.4 per cent to trade around $113 after falling as low as $109.97 a barrel.
Still, US crude futures were down over 0.4 per cent to trade around $105.5 a barrel after hitting a low of $103.46.
Both those contracts fell about 7 per cent on Monday, as Shanghai's two-stage lockdown offset concerns about tight supply over nine days which was expected to hit fuel demand in China, the world's largest oil importer.
And on the other hand, Ukraine and Russia were set to meet in Istanbul on Tuesday for their first peace talks in over two weeks. Sanctions imposed on Russia after it invaded Ukraine have curtailed oil supply and sent prices to 14-year highs earlier this month.
"Oil prices are under pressure again on expectations for peace talks between Ukraine and Russia, which could lead to an easing or avoidance of Western sanctions on Russian oil," Hiroyuki Kikukawa, general manager of research at Nissan Securities, told Reuters.
Investors also eye the Thursday meeting of the Organization of the Petroleum Exporting Countries (OPEC) and allies, collectively known as OPEC+.
But OPEC+ will likely stick to plans for a modest increase in oil output in May, despite a surge in prices due to the Ukraine crisis and calls from the United States and other consumers for more supply.