Elwin himself

HOUSTON (Reuters) - Oil futures climbed above $1.60 a barrel on Tuesday, amid cancellations from temporary U.S.-China tariff cuts and overexpected inflation reports.

Brent crude futures were priced at $66.63 per barrel, up $1.67, or 2.57%. The US West Texas Intermediate (WTI) crude oil fare was $63.67, up $1.72 or 2.78%.

The two benchmarks rose about 4% or more at the previous session, which also increased stocks on Wall Street and the dollar, after the U.S. and China agreed to sharply reduce their import tariffs by at least 90 days.

“We didn’t participate in other markets as we did yesterday during the Chinese boom, so today we’re going to catch up.” “Similarly, this morning’s data makes it possible for the Fed’s room to start taking some action.”

The U.S. Labor Department reported Tuesday that the consumer price index rose 2.3% in the 12 months to April, the smallest year-on-year growth in four years, leading Wall Street companies such as JPMorgan Chase and Barclays to reduce forecasts for U.S. recession in the coming months.

Taming inflation reading could be subject to some relief from the Fed, which has kept its benchmark interest rate unchanged since the last December cut. The U.S. central bank suspended its tax cuts due to fears that the trade war could rekindle inflation.

"All the numbers today are optimistic," said Phil Flynn, senior analyst at Price Futures Group. "The inflation volume, economic data is very supportive."

The group of oil exporters and their allies, one called OPEC+, plans to increase oil exports in May and June, which could limit the room for oil to rise.

OPEC's oil production has risen more than previously expected since April, with its May production likely to increase by 411,000 barrels per day.

Meanwhile, sources told Reuters that Saudi Arabia's crude oil supply to China will remain stable in June, after surpassing its highest level in a year last month after OPEC+'s decision to increase output.

King Kingdom is China's second largest crude oil supplier after Russia.

Elsewhere, signs have broadly shown that demand for refined fuels remain strong.

"Although the outlook for crude oil demand worsens, positive signals from the fuel market cannot be ignored," JPMorgan analysts said in a note.

“Although international crude oil prices have fallen 22% since reaching their peak on January 15, refined product prices and optimized profit margins have remained stable.”