Oil prices steadied above $48 a barrel on Tuesday, recovering from earlier losses as the dollar weakened against the euro.
Brent crude oil futures LCOc1 rose 22 cents to $48.38 a barrel by 1042 GMT.
U.S. West Texas Intermediate (WTI) crude futures CLc1 rose 10 cents to $45.25 a barrel.
The euro rose for a second day against the dollar EUR= after an 11-year low on Monday, ahead of a meeting of the Federal Reserve that may push back expectations for when U.S. interest rates will start to rise.
Prices were also supported after the Secretary-General of the Organization of the Petroleum Exporting Countries, Abdullah al-Badri, said oil prices may have bottomed out and warned of a jump to $200 a barrel if investment in new supplies was too low.
Michael Hewson, chief market analyst at CMC Markets, said that the effect of the weakened dollar and the residual effect of Badri's comments was temporary.
"I certainly don't think it changes the fundamental dynamic of the direction of prices with regard to oil," said Hewson. "When you look at where Brent is and where it's been, there's a pretty solid floor at the moment around $47 a barrel."
Oil prices have dropped nearly 60 percent since peaking in June 2014 on ample global supplies from the U.S. shale oil boom and a decision by OPEC to keep its production quotas unchanged.
Standard Chartered said OPEC's decision to keep production high was beginning to impact other producers.
"Non-OPEC output is being hit hard, and we now expect the oil market to tip into supply deficit in H2," the bank said.
Traders said there were other signs of a potential market pick-up.
"I'm not sure if prices have bottomed out, but I can see some signs for prices to rebound," said Yusuke Seta, a commodity sales manager at Newedge Japan, referring to a rise in Brent's open interest in the past few weeks.
Brent's open interest on the Intercontinental Exchange (ICE) 1ICELCOOI hit 1.69 million lots in the week of Jan. 20, a record high since the data started in 2011.
The next data on supply will come later in the day from U.S. commercial crude stockpiles, which likely rose nearly 4 million barrels last week, a Reuters survey showed. U.S. crude stockpiles posted the largest build in 14 years in the previous week. [EIA/S]
Trading volumes are likely to be limited later on Tuesday as a snow storm is expected to disrupt transport in New York.