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The
threat of conflict escalating in the Middle East and endangering
oil production has supported prices since Tuesday.
Brent crude futures were up 45 cents, or 0.6%, to $76.93 a
barrel at 0823 GMT. U.S. West Texas Intermediate crude was up 47
cents, also 0.6%, to $73.67.
On Monday, Brent futures slumped to their lowest since early
January and WTI futures touched their lowest since February, as
a global stock market rout deepened on concerns of a potential
recession in the U.S. after weak jobs data.
"Whether the reversal in risk asset prices will prove to be a
mere bottom-picking before the sell-off continues or investors
have taken the time to thoroughly assess the medium-term
implications of the US job data is open for debate," said Tamas
Varga of oil broker PVM.
Supporting the bearish demand view, Chinese trade data showed
that July daily crude oil imports fell to the lowest level since
September 2022.
Prices slipped earlier in the trading session, following U.S.
data showing an unexpected build in crude oil and gasoline
inventories.
U.S. crude oil, gasoline and distillate inventories rose last
week, according to market sources citing American Petroleum
Institute figures on Tuesday. [API/S]
The U.S. Energy Information Administration is due to release
weekly inventory data at 10:30 a.m. (1430 GMT) on Wednesday.
But both oil benchmarks broke a three-session declining streak
on Tuesday, as tensions in the Middle East stoked supply
concerns.
The Middle East is bracing for a possible new wave of attacks by
Iran and its allies following last week's killing of senior
members of militant groups Hamas and Hezbollah, with concern
that the conflict in Gaza is turning into a wider Middle East
war.
U.S. officials have been in constant contact with allies and
partners in the region and there is a "clear consensus" that no
one should escalate the situation, Secretary of State Antony
Blinken said on Tuesday.
"Any escalation of the conflict in the Middle East could see a
greater risk of disruptions to supplies from the region," ANZ
analyst Daniel Hynes said.
(Reporting by Paul Carsten in London, Nicole Jao in New York and
Colleen Howe in Beijing; Editing by Kim Coghill and Mark Potter)
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