Crude oil prices edged lower on Tuesday, giving up early gains, as worries about energy demand resurfaced amid reports showing a sharp surge in coronavirus cases across several states in America.
However, oil's downside was somewhat limited thanks to U.S. President Donald Trump's reassurance that the U.S.-China phase one trade deals remains "fully intact." Trump also wrote that he hopes China will "continue to live up to the terms of the Agreement!"
Trump's tweet helped ease concerns that had risen after White House trade adviser Peter Navarro remarked earlier that the deal with China was "over."
Navarro clarified later that his remarks about China's failure to warn the U.S. about the cornoavirus outbreak were "taken widely out of context." He said, the comments "had nothing at all to do with the Phase I trade deal, which continues in place. I was simply speaking to the lack of trust we now have of the Chinese Communist Party after they lied about the origins of the China virus and foisted a pandemic upon the world."
West Texas Intermediate Crude oil futures for August ended down $0.36 or about 0.9% at $40.37 a barrel, well off the day's high of $41.63 a barrel.
Brent crude futures ended lower by $0.45 or about 1% at $42.63 a barrel.
Traders were looking ahead to weekly crude inventory reports from the American Petroleum Institute (API) and U.S. Energy Information Administration (EIA) for further direction.
While the API's weekly report is due later today, the EIA will release its inventory data Wednesday morning.