TOKYO: Oil prices extended losses in Asia trade on Tuesday, with investors anticipating lingering US inflation and higher interest rates to depress consumer and industrial demand, according to Reuters.

Brent crude futures fell 57 cents, or 0.68 percent, to $83.14 a barrel by 9:13 a.m. Saudi time. US West Texas Intermediate crude slipped 58 cents, or 0.73 percent, to $79.22 a barrel.

Both benchmarks fell less than 1 percent on Monday as US Federal Reserve officials said they were awaiting more signs of slowing inflation before considering interest rate cuts.

“Fears of weaker demand led to selling as the prospect of Fed rate cut became more distant,” said analyst Toshitaka Tazawa at Fujitomi Securities.

Fed Vice Chair Philip Jefferson said on Monday it was too early to tell whether the inflation slowdown is “long lasting,” while Vice Chair Michael Barr said restrictive policy needs more time. Atlanta Fed President Raphael Bostic said it will “take a while” for the central bank to be confident that a price growth slowdown is sustainable.

All in all, the Fed officials’ comments pointed to interest rates staying higher for longer than markets expect. That has implications for the oil market as higher borrowing costs tie up funds in a blow to economic growth and demand for crude.

On the other hand, the market appeared little affected by political uncertainty in two major oil-producing countries.

“While there has been an upmove over some uncertainty in Iran, prices have since pared back some gains, as investors price for the status-quo in terms of policies for now and that any wider regional conflict remains off the table,” IG market strategist Yeap Jun Rong said in an email to Reuters.

Investors are focusing on supply from the Organization of the Petroleum Exporting Countries and its affiliates, together known as OPEC+. They are scheduled to meet on June 1 to set output policy, including whether to extend some members’ 2.2 million barrels per day of voluntary cuts.

“Prices remain in wait for a catalyst to drive a breakout of the current range, with eyes still on any geopolitical developments, along with oil inventories data this week,” IG’s Yeap said.

OPEC+ could extend some voluntary output cuts if demand fails to pick up, people with knowledge of the matter previously told Reuters.