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The
gains added to a rally on Monday, when crude gained a tailwind
from a 2.8% increase in U.S. gasoline futures ahead of the
Memorial Day holiday on May 29 which traditionally marks the
start of the peak summer demand season.
Brent crude was up 57 cents, or 0.8%, to $76.56 a barrel by 1102
GMT while U.S. West Texas Intermediate (WTI) crude gained 42
cents, or 0.6%, to $72.47.
"Oil prices are consolidating their bottoms, helped by a
seasonal increase in U.S. gasoline demand from next week," said
Hiroyuki Kikukawa, president of NS Trading, a unit of Nissan
Securities.
As well as gasoline demand, the onset in May of voluntary
production cuts by several members of the Organization of the
Petroleum Exporting Countries and allies including Russia, known
as OPEC+, is also expected to tighten supply.
OPEC+ meets again on June 4, and some analysts see a chance of
further cuts. Saudi Arabia's energy minister said on Tuesday he
would keep short sellers - those betting that prices will fall -
"ouching" and told them to "watch out".
"With the Saudi energy minister once again telling speculators
to 'watch out' some (short sellers) may have second thoughts,"
Ole Hansen, head of commodity strategy at Saxo Bank, said in
emailed comments to Reuters.
On the debt ceiling, White House and congressional Republican
negotiators will meet again on Tuesday to resolve a impasse over
raising the $31.4 trillion debt ceiling, with the nation facing
the risk of default in as little as nine days.
Also coming onto the radar is the latest U.S. inventory data,
which analysts expect to show a small rise in crude stocks. The
first of the week's two reports, from the American Petroleum
Institute, is out at 2030 GMT.
(Additional reporting by Yuka Obayashi in Tokyo and Andrew
Hayley in Beijing; editing by Kirsten Donovan and Jason Neely)
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