Oil traders have also taken their cue from surging stock markets. The Dow Jones industrial average jumped 3 percent Monday, but stock markets in Europe were lower Tuesday.
Analysts remain concerned investors will be disappointed if Europe's plan to protect its banks doesn't prevent a global recession or financial crisis.
"If policy fails, investors must expect further setbacks in the financial markets," said Philipp Baertschi, chief strategist at Bank Sarasin.
Prices were also cooled by a report from the 12-nation Organization of the Petroleum Exporting Countries, which projected world demand to be up by nearly 1 million barrels a day this year over last. That, however, was 180,000 barrels a day less than its previous estimate.
OPEC, representing most of the biggest crude producers, also estimated no growth in demand for its products next year, expecting demand at 29.9 million barrels a day for both 2011 and 2012.
In other Nymex trading, heating oil fell 2.47 cents to $2.8792 per gallon and gasoline futures lost 1.07 cents to $2.6846 per gallon. Natural gas retreated 0.7 cent to $3.534 per 1,000 cubic feet.
Alex Kennedy in Singapore and George Jahn in Vienna contributed to this report.