Oil prices have flattened over the last couple of days, halting a huge sell-off from Monday; investors are still cautious as fears remain over China's economic slowdown and hefty global supplies.
The sell-off on Monday came after news that Chinese industrial profits slumped in August, with the biggest drops concentrated in producers of coal, oil and metals.
Commodity and equity traders will get more evidence about China's economic performance tomorrow when final manufacturing and services PMIs will be released.
General consensus is that downward pressure on commodity prices is likely to remain until signs of stabilisation in the Chinese economy emerge. The S&P slashed their forecast for both WTI and Brent for this year and next.
It is likely that oil prices will continue to moving sideways for the next couple of days, with WTI and Brent crude expected to remain supported by key levels at $44.28 and $47.63 a barrel, respectively.
The U.S. jobs report is out on Friday. If nonfarm payrolls data turns out better than expected, it could send WTI and Brent lower.
The price of oil has received pressure from the underlying strength in the USD since last week after the Feds Chairwoman Janet Yellen argued the case for raising short-term interest rates later this year.
Markets in China and Hong Kong will be closed tomorrow for a public holiday putting greater emphasis on the US jobs data released on Friday at 1:30pm BST.