Oil prices were little changed on Tuesday as bullish signals from a tight supply picture were countered by falling Wall Street equities and possible increase to US interest rates, which could weigh on oil.

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Brent crude futures were up 30 cents, or 0.4 percent, at $86.57 a barrel. US West Texas Intermediate (WTI) crude futures were virtually flat with a gain of 3 cents to $83.34.

Global equities, which often move in tandem with oil, are set for their biggest monthly drop since the COVID-19 pandemic hit markets in March 2020. US oil futures erased earlier gains as Wall Street opened, with equities falling.

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Oil prices rebound as growing geopolitical tensions fuel supply fears

However, both WTI and Brent hit seven-year highs last week and remain on track for monthly gains of more than 10 percent.

Indicating current tight supply, Brent's six-month spread is in backwardation, with front-month delivery futures trading at a premium of about $5 a barrel.

Ahead of an expected US Federal Reserve interest rate decision on Wednesday, which could dent crude prices, geopolitical risks involving oil and gas producer Russia have been supporting oil.

Also read: Oil falls 3% as US Federal Reserve rate hike talk spooks risk markets

NATO on Monday said it was putting forces on standby and reinforcing eastern Europe with more ships and fighter jets in what Russia denounced as Western "hysteria" in response to its build-up of troops on the Ukraine border.

In the Middle East, Yemen's Iran-aligned Houthi movement launched a missile attack on Monday on a United Arab Emirates base hosting the U.S. military. The attack was thwarted by U.S.-built Patriot interceptors, U.S. and Emirati officials said.

Also fuelling supply concerns is the difficulty encountered by OPEC+, which comprises the Organization of the Petroleum Exporting Countries (OPEC) along with Russia and other producers, with efforts to hit its targeted monthly output increase of 400,000 barrels per day.