Crude oil prices fell on Tuesday, retreating after the previous session’s sharp upmove, as traders assessed the likely impact of potential supply disruptions due to the ongoing war in the Middle East.
West Texas Intermediate Crude oil futures for November ended lower by $0.41 or about 0.5% at $85.97 a barrel.
Brent crude futures settled at $87.81 a barrel, down $0.50 or about 0.6%.
The current developments in Israel don’t pose an immediate threat to oil supply as the country produces very little crude oil. Still, it is feared that the sanctions on Iran and subsequent disruptions to Iran’s oil supply would have more of an impact on oil markets, if the conflict is protracted in duration.
Meanwhile, traders await weekly oil reports from the American Petroleum Institute (API) and U.S. Energy Information Administration (EIA). The API’s report is due later today, while the EIA’s data is due on Wednesday.