At 10:25 am Singapore time (0225 GMT), front-month ICE Brent September futures moved 29 cents/b (0.46%) higher from Monday's settle at $64/b, while the NYMEX September light sweet crude futures contract was 31 cents/b (0.55%) higher at $57.18/b.US commercial crude inventories for the week ended July 26 were expected to fall by 3.9 million barrels to 441.1 million barrels, according to analysts surveyed Monday by S&P Global Platts.
The expected draw would pare the nationwide surplus to the five-year average of US Energy Information Administration data to 2.8%, the narrowest supply overhang since early May.
The outlook for product inventories was, however, mixed. US gasoline stocks were expected to draw 1.1 million barrels, putting inventories at 231.4 million barrels, analysts said. But distillate stocks likely added around 400,000 barrels to storage, moving stocks up to a 22-week high of 137.2 million barrels.
Preliminary data on last week's US inventory report is due for release from the American Petroleum institute later Tuesday, while the more definitive numbers from the US EIA is due for release later Wednesday.
Markets, meanwhile, will be looking out for comments from the resumption of trade talks between the US and China in Shanghai, and the US interest rate decision set to be taken by the US Federal Open Market Committee.
"Crude prices are extending the previous session's gains this morning, but I don't see a strong upward push from fundamentals. The resumption of US-China trade talks is unlikely to foster a constructive view on oil, especially as a deal remains far down the road," Vandana Hari, founder of Vanda Insights, said.
"This is the first face-to-face meeting since trade talks broke down in May and both sides have downplayed the expectations from this week's meeting," UOB bank analysts said in a note.
"Crude oil futures were also well bid on the back of rising expectations of a rate cut in the US," ANZ analysts said in a note Tuesday.
The Fed is widely expected to cut US interest rates by 25-50 basis points on Wednesday, the first such move in over a decade. A cut is likely to be bullish for oil futures by bolstering demand at a time when recent economic indicators have been flagging.
"The expected Fed rate cut may buoy sentiment a bit, but I expect a weak impact and one likely to wear out after the decision," Hari said.
As of 0225 GMT, the US Dollar Index was up 0.09% at 97.875.