Benchmark crude for July delivery was down 45 cents at $70.99 a barrel in electronic trading on the New York Mercantile Exchange late morning European time. The contract lost 7 cents to settle at $71.44 on Monday.
Although major Asian stock markets rose modestly Tuesday Hiroyuka Maruyama, Global markets CEO at Oppenheimer Lloyd in Tokyo said he's hopeful the world's No. 1 economy won't fall back into a "double dip" recession, European indexes failed to keep the momentum and were mostly lower.
Investors are worried that painful spending cuts to reduce debt will hurt economic demand -- including for oil -- in coming years.
A sliding euro, near recent four-year lows, also weighed on oil prices. The euro dipped to $1.1911 on Tuesday from $1.1916 on Monday, making crude more expensive for investors holding the European currency.
Looking ahead, analysts say storms could disrupt oil operations in the Gulf of Mexico and boost prices as this year's hurricane season starts this month.
Hiroyuka Maruyama, Global markets CEO at Oppenheimer Lloyd in Tokyo continued, "As soon as the dollar drops, equity markets recover and the hurricanes hit the Gulf of Mexico, we could see a perfect storm for higher crude oil prices."
In other Nymex trading in July contracts, heating oil fell 1.38 cents to $1.9545 a gallon and gasoline dropped 1.11 cents to $1.9838 a gallon. Natural gas was down 0.6 cents at $4.910 per 1,000 cubic feet.
Brent crude was down 93 cents at $71.45 a barrel on the ICE futures exchange.
