SINGAPORE (Reuters) – Oil prices rose in early trading on Tuesday as rising geopolitical tensions in the Middle East heightened supply concerns.
Brent crude futures rose 25 cents, or 0.3%, to $82.65 a barrel at 0105 GMT. U.S. West Texas Intermediate crude was up 31 cents, or 0.4%, at $77.09 a barrel.
Both contracts fell more than $1 on Monday on concerns about Chinese demand amid a deepening real estate crisis, after a Hong Kong court ordered the liquidation of property giant China Evergrande Group.
But analysts say the market remains on edge amid rising oil supply concerns, as Washington vowed to take “all necessary action” to protect its troops after a deadly drone attack in Jordan by Iran-backed militants. Which was the first US military death since Israel. Gaza war started.
Commonwealth Bank of Australia analyst Vivek Dhar said, “If US-Iran tensions escalate, particularly through direct confrontation, the risk increases that Iran’s oil supplies will be adversely affected.” “Iranian oil exports are likely to be the most vulnerable due to enforcement.” A Comment.
Dhar said Iran exported 1.2-1.6 million barrels of crude per day through most of 2023, amounting to 1-1.5% of global oil supply.
“How Iran responds to the US’s escalating tensions will also determine the direction of oil markets,” he said. The main concern is that Iran is threatening to blockade the Strait of Hormuz, through which 15-20% of global oil supplies flow. Transcendence takes place.”
Additionally, the attack on a Trafigura oil tanker in the Red Sea over the weekend has increased the risk of supply disruptions, while also increasing the risk of the US being dragged into the conflict, ANZ analysts said in a note.
“Traders have started covering short positions; but there has been a slight increase in long positions,…