Oil prices slipped on Tuesday after surging more than $5 a barrel in the previous session on concerns about tight supply. Benchmark Brent crude futures declined 0.6 percent to $105.60 a barrel, while WTI crude futures were down half a percent at $98.89.
New COVID-19 cases in China jumped to almost 700 and data showed the euro zone's inflation accelerated as estimated in June to set a fresh record high, raising worries about a possible recession.
Meanwhile, reports emerged that European Central Bank policymakers may consider a bigger-than-expected rate hike later in the week.
The euro rallied after Reuters said policymakers will discuss whether to raise interest rates by 50 bps on Thursday to tame record-high inflation.
Amid lingering concerns over gas supply from Russia, investors await U.S. crude supply data from the American Petroleum Institute later in the day for further direction.
