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Oil Prices Hold Steady In Cautious Trade

Oil prices were flat to slightly higher on Tuesday as both the U.S. and China struck a conciliatory tone on trade talks and tensions in the Gulf appeared to stop short of a military showdown.

Benchmark Brent crude edged up 0.3 percent to $70.45 a barrel, after ending down 0.6 percent in the previous session.

U.S. West Texas Intermediate (WTI) crude futures were up 0.1 percent at $61.08 per barrel, after losing 1 percent the previous day.

Speaking at a White House dinner on Monday, U.S. President Donald Trump said that he was optimistic about resolving the U.S. trade dispute with China.

"He just got back from China. We'll let you know in about three or four weeks whether or not it was successful ... but I have a feeling it's going to be very successful," Trump said, referring to U.S. Treasury Secretary Steven Mnuchin's recent trade talks in Beijing.

Chinese government's top diplomat, State Councillor Wang Yi, also struck a more upbeat tone, noting there was still hope to resolve the issue in a friendly way.

China on Monday ignored a warning from Trump and said it would raise tariffs on $60 billion worth of U.S. goods from June 1, in retaliation to the latest round of U.S. tariff hikes.

Meanwhile, a U.S. official said Iran was the likely culprit after four commercial vessels, including two Saudi oil tankers, were sabotaged on Sunday near Fujairah.

"We need to do a thorough investigation to understand what happened, why it happened, and then come up with reasonable responses short of war," John Abizaid, U.S. ambassador to Saudi Arabia told reporters in the Saudi capital Riyadh in remarks published on Tuesday.

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