Oil prices stumble on supply cuts and recession fears

Oil prices were flat Tuesday as the market weighed signs of a tightening crude supply amid growing fears that a global economic slowdown will reduce oil demand this year. 

Oil markets had a slow start to the week, sustaining much of the previous week's losses amid growing signs the United States may enter a recession within the next 12 months, Bloomberg reported citing economists. 

The disappointing forecast came amid rising inflation in the country, with a sharp increase in interest rates by the U.S. Federal Reserve having little impact on price pressures.

In addition, there were growing concerns about continued demand growth in China, as President Xi Jinping stressed that the country has no plans to relax its strict zero-Covid policy. A series of lockdowns and restrictive measures under this policy has significantly slowed economic activity in China this year, reducing demand for crude oil in the world's largest oil importer. 

The Fed is expected to continue to raise interest rates at a rapid pace to reduce inflation, which is projected to push up the dollar and negatively impact oil markets. In addition, higher rates are expected to contribute to a slowdown in global economic growth, which is unfavorable for oil markets.