Oil dropped on Tuesday, giving up previous gains, as uncertainty about the US debt ceiling agreement dampened the risk-on mood in the market and conflicting signals from key producers muddied the supply projections before their conference this weekend.

Brent crude futures slipped 0.8% to $76.48 per barrel post surging 0.5% on Tuesday, while US WTI slid 0.6% to $72.25 per barrel.

While Democratic President Joe Biden and Republican House of Representatives Speaker Kevin McCarthy continued to be optimistic that the agreement will succeed, some hard-right Republican members stated on Monday that they might oppose a deal that would lift the debt ceiling in the United States, the country with the highest oil consumption in the world.

The market is also being pressured by the close proximity of the debt deadline to the OPEC+ meeting on June 4, which is taking place when supply cutbacks from OPEC and its allies, including Russia, may be increased in response to a recent drop in prices.