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Oil prices dip on investor caution as market watches Middle East turmoil

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Brent crude fell 36 cents to $87.79 a barrel by 0805 GMT, while U.S. West Texas Intermediate crude eased 35 cents to $86.03

Oil prices eased on Tuesday after rallying more than 4 per cent in the previous session, with traders cautious as they watched for potential supply disruptions amid military clashes between Israel and the Palestinian Islamist group Hamas.

“There is still plenty of uncertainty across markets following the attacks in Israel over the weekend,” said ING analysts on Tuesday, adding that oil markets are now pricing in a risk premium. Israel’s port of Ashkelon and its oil terminal have been shut in the wake of the conflict, sources said on Monday.

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