Oil prices eased in early trade on Wednesday as worries about global demand due to weak economic momentum in China and fading hopes for U.S. interest rate cuts in the near term outweighed supply fears on heightened tensions in the Middle East.
The dollar was broadly steady on Wednesday, keeping the yen rooted near 34-year lows after comments from Federal Reserve officials, including Chair Jerome Powell, suggested U.S. interest rates are likely to stay higher for longer.
The dollar hit a five-month high against major peer currencies on Tuesday following hotter-than-expected U.S. retail sales figures, raising intervention worries as the yen languished at its lowest level since 1990.
Oil prices rose on Tuesday amid heightened tensions in the Middle East after Israel's military chief said his country would respond to Iran's weekend missile and drone attack amid calls for restraint by allies.
Asian stocks fell sharply on Tuesday, tracking an overnight rout on Wall Street amid persistent concerns over geopolitical tensions in the Middle East and higher-for-longer U.S. interest rates.
U.S. business inventories rose in February amid strong gains at retailers and wholesalers, suggesting that inventory investment could contribute to economic growth in the first quarter.