Brent crude oil lost ground on Tuesday morning following Federal Reserve Bank of New York President William Dudley's speech on Monday at which he reignited taper worries.
The commodity traded at $108.05 at 5:46 GMT as investors revised their taper estimates following Dudley's remarks.
CNBC reported that Dudley said he was becoming more hopeful about the US' economic recovery on Monday, which sent crude prices downward as investors interpreted the comments as positive towards a sooner-rather-than-later taper.
Dudley's remarks were closely followed by even more bullish comments from Philadelphia Fed President Charles Plosser who said he believes the US' recently stronger economic and labor market data calls for the US central bank to set a fixed dollar amount on its quantitative easing program and cut off the stimulus spending once the limit is reached.
Incoming Federal Reserve Chief Janet Yellen made contrary remarks just last week, saying that the Fed still has work to do and that the US economy was not yet where it needed to be. The contradictory comments coming out of the central bank have only added to ongoing confusion as investors attempt to predict the Fed's taper time line.
However, Brent found some support from the ongoing political and social turmoil in Libya, where more than half of the nation's export capacity has been shut down by protesters. The OPEC producer's oil exports have fallen by more than 1 million barrels per day over the past six months as the government attempts to soothe the tension.
Moving forward all eyes will be on talks between Iran and World leaders, set to begin on Wednesday. The two sides will attempt to reach a deal on Iran's disputed nuclear program in exchange for loosened sanctions on Iranian oil.