Both Brent and US crude prices dropped nearly USD 2 a barrel shortly after trading in Brent started on Tuesday before recovering later in the session.
"A lot of the fall was due to short covering," said Ben Le Brun, market analyst at Sydney's OptionsXpress.
"There could be a bit of profit taking for people who have gone long," he added. The falls also indicated investors may have "gone overboard" in pushing up prices so fast, Le Brun said.
US crude, also known as West Texas Intermediate, climbed 27.5 percent by the end of the previous session after three days of gains, the largest three-day increase in dollar terms since February 2011 and the biggest percentage increase since August 1990.
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