Oil steadies after falling to four-year lows in previous session

Oil steadied on Tuesday after hitting four-year lows in the previous session that was driven by an OPEC+ decision to accelerate output increases, stoking fears of oversupply at a time when U.S. tariffs have spurred concerns about demand.

Brent crude futures rose 10 cents to $60.33 a barrel by 0050 GMT, while U.S. West Texas Intermediate crude added 10 cents to $57.23 a barrel.

Both benchmarks had settled at their lowest since February 2021 on Monday.

OPEC+ agreed on Saturday to further speed up oil production hikes for a second consecutive month, raising output in June by 411,000 barrels per day (bpd).

The June increase by eight participants in the OPEC+ group, which includes allies such as Russia, will take the total combined hikes for April, May and June to 960,000 bpd. That represents a 44% unwinding of the 2.2 million bpd of various cuts agreed on since 2022, according to Reuters calculations.

The group could fully unwind its voluntary cuts by the end of October if members do not improve compliance with their production quotas, OPEC+ sources told Reuters. U.S. shale producer Diamondback Energy lowered its output forecast for 2025 on Monday and said that a combination of global economic uncertainty and rising OPEC+ supply has brought U.S. oil production to a tipping point. Meanwhile, U.S. Treasury Secretary Scott Bessent said on Monday President Donald Trump’s tariff, tax-cut and deregulation agenda would work together to drive long-term investment in the U.S. economy, adding that U.S. financial markets were “anti-fragile” and would weather any short-term turbulence.

The U.S. Federal Reserve will likely leave interest rates unchanged on Wednesday as tariffs roil the economic outlook.

Barclays lowered its Brent crude forecast on Monday by $4 to $70 a barrel for 2025 and set its 2026 estimate at $62 a barrel, citing “a rocky road ahead for fundamentals” amid escalating trade tensions and OPEC+’s pivot in its production strategy.