Oil prices rose on Tuesday as investors covered short positions following a sharp drop the previous day, though ongoing concerns over we monetary policy and tariff-related economic risks capped gains. Brent crude rose 42 cents, or 0.6 per cent, to $66.68 a barrel by 0620 GMT, while US West Texas Intermediate (WTI) for May delivery climbed 45 cents, or 0.7 per cent, to $63.53. The more active June WTI contract stood at $62.86. Both benchmarks had lost more than 2 per cent on Monday after progress in US-Iran nuclear talks eased concerns about global supply disruptions. Analysts said the rebound reflected short-covering, but recession fears driven by US tariffs and uncertainty around Federal Reserve policy continued to weigh on the market. President Donald Trump's criticism of Fed Chair Jerome Powell raised questions about the central bank's independence and the economic outlook. A Reuters poll showed recession odds nearing 50 per cent within the next 12 months, as trade tensions and rate cut expectations dampen sentiment. Meanwhile, Iran's potential return to oil markets is seen as less threatening after recent diplomatic progress, easing immediate fears of tighter sanctions. In related developments, Russia's economy ministry cut its 2025 Brent price forecast by nearly 17 per cent, while US inventories data due later this week is expected to show a drop in crude and gasoline stocks. Attribution: Reuters Subediting: M. S. Salama
