Market News

(Bloomberg) -- Oil edged higher after tumbling Monday following US President Donald Trump’s escalating criticism of Federal Reserve Chair Jerome Powell, which rattled global markets.

Brent traded near $67 a barrel after sliding 2.5% in the previous session, the most in more than a week. Crude’s partial recovery was aided by a bounceback in US equity futures.

In his latest broadside against Powell, Trump warned that the US economy may slow if the central bank doesn’t move to reduce interest rates. The president has contemplated firing the Fed chair, prompting investors to sell US stocks, bonds and the dollar on Monday.

Oil was swept up in the chaos, extending a slump this month that’s been exacerbated by mounting tensions between the US and its top trading partners.

“Near-term, I would expect that the biggest wave of selling is behind us,” Martijn Rats, global oil strategist at Morgan Stanley, said in a Bloomberg Television interview. “As we go through the summer, seasonal demand does support things a little bit, but then in the second half we will probably have another period of downward pressure.”

Despite recent pessimism as forecasters slash their oil-demand forecasts, nearby market gauges have been pointing to strength. The closest Brent futures contract is trading at its biggest premium to the next month since January, a sign of tight supplies.

--With assistance from Grant Smith, Anna Edwards, Guy Johnson and Lizzy Burden.