Oil prices paused their recent advances, receding on Tuesday after surging more than 7% in the previous three sessions on supply concerns prompted by fears of a wider Middle East conflict and the potential shutdown of Libyan oil fields.
Brent crude futures fell 18 cents, or 0.2%, to $81.25 a barrel at 0430 GMT, while U.S. West Texas Intermediate crude futures dropped 28 cents, or 0.4%, to $77.14 a barrel.
“Losses in oil prices may seem contained in today’s session, which suggest prices taking a breather following its sharp rally over the past few days,” said Yeap Jun Rong, market strategist at IG.
“With the jump in oil prices pricing for geopolitical risks in the Middle East and a production halt in Libya, market participants are now in some wait-and-see to assess further developments.”
Oil markets rose sharply in the previous three sessions driven by expectations of U.S. interest rate cuts that could boost fuel demand, military assaults between Israel and Hezbollah in Lebanon over the weekend that threaten a wider Middle East conflict potentially disrupting supply from the key producing region and the potential Libyan closures. Over that period, WTI gained 7.6% and Brent gained 7%.
