Oil futures rose on Tuesday, finding support as traders watched economic data from China and prepared for talks aimed at reviving the Iranian nuclear deal. West Texas Intermediate crude for May delivery CL.1, + 2.06% CLK21, + 2.06% rose 98 cents, or 1.7%, to $ 59.63 a barrel on the New York Mercantile Exchange. June Brent BRN00 crude, + 1.85% BRNM21, + 1.85%, the global benchmark, rose 95 cents, or 1.5%, to $ 63.10 a barrel on ICE Futures Europe.
Crude fell 4% on Monday, under pressure linked to last week’s decision by the Organization of the Petroleum Exporting Countries and its allies, known as OPEC +, to relax restrictions on production. The plan would return more than 2 million barrels a day of production to the market in July. Analysts said talks in Vienna aimed at reviving Iran’s nuclear pact, scheduled to start on Tuesday, have also been a headwind for crude. The talks are aimed at restoring the nuclear deal, which would lead to a lifting of US sanctions that have restricted Iranian crude exports. “The United States and Iran will not meet directly, but the Europeans will act as intermediaries,” Marshall Gittler, head of investment research at BDSwiss Holdings, said in a note. “As the possibility of a breakthrough in the talks fades, the likelihood of a rebound in Iran’s exports is also fading, removing a risk from the oil market.” Meanwhile, Caixin China Services‘ purchasing managers index rose to 54.3 in March, recovering from a 10-month low of 51.5, Caixin Media Co. and research firm Markit said on Tuesday. A figure above 50 indicates an expansion in activity. Meanwhile, concerns about the supply implications of last week’s OPEC + meeting will continue to weigh on the market, analysts lament. The move “will lead to a renewed supply surplus in the oil market and would initially mean abandoning the stated goal of eliminating excess crude stocks,” Commerzbank analysts wrote in a note.