By Shariq Khan
(Reuters) – Oil prices rose slightly in early trading in Asia on Tuesday, reversing losses from the previous session, as investors continued to assess risk from geopolitical concerns in the Middle East.
Global benchmark Brent crude futures rose 39 cents, or 0.5 percent, to $87.39 a barrel by 0033 GMT, while U.S. West Texas Intermediate crude futures rose by 40 cents, or 0.5%, to $82.30 per barrel.
Both benchmarks fell 29 cents in the previous session on signs that a recent escalation in tensions between Israel and Iran was having little near-term impact on the region’s oil supplies.
However, analysts noted that a host of risks remain in the oil market. ANZ analysts highlighted the US approval of new sanctions against Iran’s oil sector that expand current sanctions to include foreign ports, ships and refineries that knowingly process or ship Iranian crude.
“The geopolitical context is still very risk-laden at the moment, so it’s clear we’re going to see a lot of volatility until there’s a lot more clarity,” ANZ analysts said in a podcast .
Analysts at Barclays said on Monday that risks to their forecast of $90 a barrel for the price of Brent this year remained skewed to the upside.
“The looming threat of geopolitical risk impacting oil market fundamentals has largely abated, but the overall trend in this risk since last October is concerning,” Barclays analysts said in a note.
U.S. inventories of crude oil are expected to have increased last week while those of refined products likely fell, according to a preliminary Reuters poll of analysts.
(Reporting by Shariq Khan in New York; editing by Jamie Freed)
