RIYADH: Oil prices mostly maintained gains on Tuesday following attacks on shipping in the Red Sea that heightened concerns about supply disruptions. According to Reuters, Brent crude futures dipped 1 cent to $82.52 a barrel, while US West Texas Intermediate crude futures edged up 1 cent to $77.59 a barrel.
The attacks, attributed to Iran-aligned Houthis in support of Palestinians, have led to increased freight rates and shipping times. On Monday, US Central Command reported an unsuccessful missile attack by the Houthis on the US-flagged oil tanker Torm Thor in the Gulf of Aden on Feb. 24.
The ongoing conflict between Israel and Hamas in Gaza continues to impact the situation. US President Joe Biden expressed hope for a ceasefire by next Monday, but public positions from Israel and Hamas remain far apart, with both sides blaming each other for delays.
Oil benchmarks rose over 1 percent on Monday, partially offsetting previous week declines. Concerns about shipping disruptions and a more hawkish Federal Reserve, affecting the demand side, have contributed to the rebound.
Kansas City Federal Reserve Bank President Jeffrey Schmid signaled reluctance to cut interest rates in his debut speech on policy, emphasizing that high borrowing costs can impact economic growth and oil demand.
Improved demand in China has also supported oil prices on Tuesday. Refineries in China continue brisk buying in the physical market despite planned maintenance halts.
Market attention is on the American Petroleum Institute’s weekly data on US crude inventories scheduled for release on Wednesday at 0:30 a.m. Analysts estimate a rise of about 1.8 million barrels in crude inventories for the week ending Feb. 23.
