Following a spike of more than 7% in the preceding three sessions, oil prices halted recent advances to trade in a range on Tuesday due to supply concerns brought on by worries of a wider Middle East conflict and the possible suspension of Libyan oil fields, according to Reuters.
By 9:30 a.m. Saudi time, Brent crude prices were up 3 cents at $81.46 per barrel, while US West Texas Intermediate crude futures were down 6 cents at $77.36 per barrel.
According to IG market strategist Yeap Jun Rong, “losses in oil prices may seem contained in today’s session, which suggests prices taking a breather following a sharp rally over the past few days.”
“Market participants are currently in a wait-and-see mode to assess further developments, given the jump in oil prices pricing for geopolitical risks in the Middle East and a production halt in Libya.”
Expectations of US interest rate cuts, which could increase fuel demand, military assaults between Israel and Hezbollah in Lebanon over the weekend, which pose a threat to a wider Middle East conflict, disruptions in supply from the major producing region, and the possibility of Libyan closures were the main drivers of the rise in the previous three sessions.
WTI increased by 7.6 percent and Brent by 7 percent throughout that time.
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