Oil rebounded from its lowest level in 10 weeks and Brent crude produced in North Sea pipeline system remained closed after the platform leak.
"We seem to be temporarily parked about supporting the 200-day moving average in the West Texas," said Ric Spooner, chief market analyst at CMC Markets in Sydney. "To be sure prices holding or increasing, we should see an increase in demand."
Market News
Asian stocks rebound, easy fuel policy risks
Asian stocks rebounded sharply on Tuesday, mastering the coolest losses the previous day due to a sharp drop in Chinese stocks and globally accommodative monetary policy helped revive risk appetite.
European markets also saw a rise, with financial spreadbetters predicting London's FTSE 100, the Paris CAC-40 and Frankfurt's DAX to open as much as 0.6 percent. Almost flat showing in U.S. stock futures pointed to a subdued start on Wall Street.
The broad MSCI Asia-Pacific shares outside Japan jumped 1 percent after falling 1.3 percent as Chinese shares dived on concerns about Beijing's move to tighten the housing market may weigh on growth on Monday.
China shares rebounded from a two-month closing low, lifting Hong Kong market by 0.1 percent, and fears of policy tightening on the decline after the central bank refrained from draining funds after a sharp drop in money market rates. Shanghai shares rose 0.9 percent.
The latest data confirmed a modest rebound in the second largest economy in the world this year, with a private February HSBC Services Purchasing Purchasing Managers Index (PMI) falling to 52.1 from 54.0 in January, after seasonal adjustment.
Beijing has promised to increase budget spending in an effort to achieve economic growth 7.5percent this year, outgoing Prime Minister Wen Jiabao, outlining a plan of reform in China annual parliamentary session was launched on Tuesday.
"China's economy will slow in the second quarter, but the slowdown is not significant enough to derail the recovery," said Dariusz Kowalczyk, senior economist and strategist, non-Japan Asia at Credit Agricole CIB in Hong Kong, adding that on Monday sell-off in Chinese stocks was "justified" because the markets tend to move forward toward growth.
"As property curbs expanded construction of real estate may well slow to the point of adding further downward pressure on the economy. Nevertheless, the 7.5 per cent growth target announced today that it is safe," he said.
Australian shares outperformed their Asian counterparts with a 1.3 percent rally in financial and consumer stocks leading the major profit after healthy retail and export data, supported by an optimistic outlook for the economy.
Reserve Bank of Australia kept its cashrate at a record low 3.0 percent, as expected, higher Australian dollar on the day of its high of $ 1.0254.
RBA has started a series of meetings of the monetary policy is going week.Major central banks around the world should support peace and position, given the fragile economic conditions, political uncertainty in Europe, the U.S. and the budget debate. Analysts also say none of the uncertainty is considered as a risk serious enough to cause the financial crisis.
Janet Yellen, vice chairman of the Federal Reserve said Monday aggressive monetary stimulus in the U.S. central bank is justified, given how far the economy is operating below its potential.
"Despite the decline in spending in the U.S., the lack of a political settlement in Italy and weak data in Asia, we just can not get the proper mood" risk-off "... like going crazy money (quantitative easing and zero interest rate policy) trumps any other concern, "said Kit Juckes, strategist at Societe Generale in a note to clients.
UNCERTAINTY
Japanese Nikkei Stock Average closed down 0.3 percent, after earlier scaling a fresh 53-month high.
The dollar slipped 0.5 percent against the yen to 92.96 yen to the fact that traders see a "sell-the-fact" behavior after the candidates for two posts of the Bank of Japan Deputy Governor faced parliamentary confirmation hearings.
Expectations that the Bank of Japan has a new mode to start later this month, will be much bolder reflationary measures pushed 10-year Japanese government bondyield down as 0.585 percent higher, the lowest since June 2003.
In addition to the actions of the Chinese government to cool the overheated real estate market, there are concerns about a slowdown in economic growth in the U.S. after the automatic "sequester" spending cuts were allowed to die, starting March 1.
The current political instability in Italy also remains a potential risk, as inconclusive elections last month could pave the way for new elections within a few months. But expectations the European Central Bank will use its scheme to help fund the fight against the euro zone countries based investor confidence.
The euro unchanged around $ 1.3040.
The ECB holds its policy meeting on Thursday, and while few expect the central bank to cut interest rates this week, many believe such actions come sooner rather than later.
Later this week, the Bank of Japan and Bank of England hold their meetings.
Spot gold gained 0.5 percent to $ 1,581.30 an ounce, snapping four days of losses.
U.S. crude rose by 0.3 per cent at $ 90.38 a barrel while Brent rose 0.4 percent to $ 110.53.
"I would call this movement in the oil markets, as bargain hunting rather than any change in the outlook," said Ker Chung Yang, a senior analyst at Phillip Futures investment in Singapore. Reuters.com
Currencies
Dollar slips against yen, Australian stronger as RBA stands pat
The dollar fell against the yen on Tuesday, under pressure from the sale, the reaction after the confirmation hearings for two government nominees Store Japan Deputy Governor.
KikuoIwata, appointed by the government for one of two deputygovernorships central bank, said that foreign bond purchases would be a policy option only if other initiatives failed.
Hiroshi Nakaso, government nominee for the other deputy governor of the Bank of Japan said on Tuesday it will conduct monetary policy, without being bound by precedent.
The dollar fell 0.6 percent to 92.97 yen, pulling away from the maximum of 94,77 yenstruck February 25, which was the highest level of the dollar against the yensince May 2010.
The fall of the dollar against the yen, mainly reflecting market positioning, said Jesper Bargmann, Asia head of G11 spot FX for RBS in Singapore.
Traders are likely long dollar / yen going into the confirmation hearings on Tuesday and ofIwata Nakaso, Bargmann said.
"I think that is a bit of buying the rumor sell the fact," said Bargmann.
"So when we see the headlines come out, all have expected more, but there is very little more, they can actually speak. Rhetoric was very aggressive. But now we need to see some action," he added.
The dollar extended its losses against the yen after the opposition Democratic Party lawmaker Keisuke Tsumura said that he could not support Iwata, BOJ Deputy Governor nominee government because Iwata wants to revise the law governing the independence of the central bank.
The ruling Liberal Democratic Party has a majority in the lower house, but do not have a majority in the upper house. OppositionDemocrats could potentially hold the decisive vote for nominees in the camera.
The dollar extended its losses against the yen after comments Tsumura, in asthey stirred some concern, Iwata, a supporter of aggressive monetary easing, will be approved by parliament.
Traders, however, said Iwata can still win the approval of Parliament, even if the Democratic Party of Japan (DPJ) was against him, while the other opposition parties to join the ruling Liberal Democratic Party (LDP) to approve his candidacy.
"Apparently ... the DPJ can not block it, if small opposition parties LDP vote," said Jeffrey Halley, FX trader Saxo Capital Markets in Singapore.
Gareth Berry, G10 FX strategist at UBS in Singapore also noted that, according to unclearwhether Tsumura reflects the position of the opposition DPJ as a whole.
"It is not clear if this is, in the opinion of his party, but it seems like an isolated comment from one official, at this stage," said Berry.
"Let's see how things work out ... The main thing Kuroda looks like he has the support of the DPJ," he said, referring to Haruhiko Kuroda, the nominal government to replace the Bank of Japan Governor Masaaki Shirakawa, who will leave at the end of March.
Elsewhere, the Australian dollar rose 0.4 percent to $ 1.0244, after having received a lift theReserve Bank of Australia (RBA) left interest rates unchanged at a record low of 3.0 percent, as expected.
The Australian dollar rose after the decision of the interest rate as the market has seen slim chance the interest rate on RBA.
The euro rose 0.1 percent to $ 1.3042, remaining above the low of $ 1.2966 on Friday, its lowest level in nearly three months.
The euro was weighed down by political uncertainty in Italy and weak economic indicators, which stirred speculation that the European Central Bank may cut interest rates sooner than previously thought.
One of the factors that could support the single currency in the short term positioning in the market, said a trader at a Japanese brokerage in Tokyo.
"If you look at the IMM position ... there was a shift to a short position on what was significant long positions," the trader said, adding that the euro could get some support if traders cut their bearish bets euro.
Figures published last week showed that currency speculators on the International Monetary Market (IMM) rolled to net short positions in the euro for the week ending February 26 for the first time since early January. Reuters.com