Sugar rebounded Tuesday from a four-month low, buoyed by the Brazilian state-run oil company's decision to raise gasoline prices.

Raw sugar for March delivery rallied 3% to settle at 19.51 cents a pound on the ICE Futures U.S. exchange. The front- month contract settled at 18.94 cents a day earlier, the lowest level since early August.

"That would mean that the main plant of the bearish argument--a maximum swing to sugar production in CS [central- south] Brazil next year--would be knocked away," wrote Marex Spectron analysts in a recent note.The increase in gasoline prices is positive for sugar as there will be more demand for ethanol in Brazil, encouraging mills there to direct more cane crush to ethanol instead of sugar.

But some traders noted that sugar prices took a dip in early Tuesday morning trading before roaring back. "There has to be something else besides Petrobras that did this," said Nick Gentile, managing partner at Nickjen Capital Management & Consultants.

Elsewhere, Egypt's state buyer, the General Authority for Supply Commodities, said Monday it was seeking at least 50,000 tons of white sugar in a tender. The sugar is due to arrive by Dec. 31.

Egypt's decision to devalue its currency in early November has caused a cutback in the country's commodity imports, as a result of a weaker Egyptian pound.

In other markets, cocoa for March edged down by 0.4% to close at $2,358 a ton; arabica coffee for March was down 1.7% to end at $1.4200 a pound; frozen concentrated orange juice futures lost 1.4% to settle at $2.1700 a pound; and March cotton was up 0.5% to close at 71.33 cents a pound.