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Also weighing was stronger-than-expected U.S. retail sales for
March that further reinforced expectations the U.S. Federal
Reserve is unlikely to rush to cut interest rates, a scenario
that dampens the prospects for oil demand.
Brent futures for June delivery fell 26 cents, or 0.3%, to
$89.84 a barrel by 0935 GMT. U.S. crude for May slipped 20
cents, or 0.2%, to $85.21.
"The balancing act between sticky inflation, a hesitant Fed and
the gradual move towards a full-blown regional conflict keeps
oil...in its range," said Tamas Varga of oil broker PVM.
"Material disruption to oil production, supply or shipping must
take place to approach the $100 a barrel milestone. Currently
such a development appears implausible."
Concern that Iran would respond to the strike on its embassy
compound in Damascus helped send Brent on Friday to $92.18, the
highest since October.
Prices, though, fell on Monday after Iran's attack on Israel
proved to be less damaging than anticipated, easing concerns of
a quickly intensifying conflict that could disrupt supply.
"As the risk to supply is waning and a military response from
Israel looks less likely as more time passes, prices are holding
steady," said Rystad Energy's Jorge León. "Tensions are high,
and either party's next moves are hard to predict."
Iran will respond to any action against its interests, President
Ebrahim Raisi said on Tuesday, according to the Iranian Student
News Agency, a day after Israel warned it will respond to
Tehran's weekend drone and missile attack.
Iran produces more than 3 million barrels per day of crude oil
as a major producer within the Organization of the Petroleum
Exporting Countries (OPEC).
(Additional reporting by Laura Sanicola in Washington and
Sudarshan Varadhan in Singapore; editing by Jason Neely)
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