U.S. crude settled at a six-year low on Tuesday after No. 2 consumer China devalued its currency, raising questions about its demand for crude, while a new projection showed non-OPEC producers were more resilient than expected to keeping output high amid low prices. (Tweet This)

U.S. crude hit contract lows, while Brent, the global benchmark, lost most gains from a Monday rally, heading for its largest decline in a week.

"It's time to sell any and all rallies," said Tariq Zahir, managing member at Tyche Capital Advisors in Laurel Hollow in New York, who believes oil prices are heading lower.

Read MoreOPEC just kicked oil into the $30s

China's central bank made what it called a "one-off depreciation" of nearly 2 percent in the yuan after a run of poor economic data, guiding the currency to a near 3-year low.

OPEC projected that oil supplies from countries outside the group will rise by 90,000 barrels per day this year, a sign the crude price collapse was taking longer than thought to hit the North American shale oil industry and other competing sources.