Oil prices edged down slightly on Tuesday after gaining more than 4% in the previous session as markets weighed the potential for supply disruptions as the conflict between Israel and the Palestinian Islamist group Hamas continued.

The dollar softened on Tuesday along with U.S. interest rate expectations and a fall in Treasury yields as investors detected a slight dovish shift in Federal Reserve officials' tone.

Some of the world's poorest countries face budget cuts topping $220 billion over the coming five years due to a debt crisis that has pushed dozens to the brink of default, according to an Oxfam International report released on Monday.

U.S. job growth unexpectedly surged in September, while the unemployment rate and wage growth held steady, pointing to a lingering tightness in the labor market that could impact Federal Reserve monetary policy over the rest of the year.

The U.S. Commerce Department on Friday added 42 Chinese companies to a government export control list over their support for Moscow's military and defense industrial base - support that includes the supply of U.S.-origin integrated circuits.

Oil prices jumped more than $4 a barrel in early Asian trade on Monday, as dramatic military clashes between Israeli and Hamas forces over the weekend deepened political uncertainty across the Middle East.