The price of crude oil settled well off day's lows Tuesday, as the greenback gave back its early gains against the euro. Profit booking from a two-month high reached in the previous session and expectation of a further increase in US crude inventories weighed on the prices.

Light, sweet crude oil for delivery in April settled $0.38 lower at $81.49 per barrel in the New York Mercantile Exchange, recuperating from the intraday low of $80.16.

Oil prices remain shy of the $85 levels reached in early January, though the prices have recovered considerably over the recent weeks.

In the absence of major economic releases, traders awaited oil inventory data for cues. The American petroleum Institute is expected to release its weekly inventory data later today.

The official inventory update from US Energy Information Administration is scheduled for Wednesday. Analysts are expecting a build of another 2 million barrels in crude stockpiles.