SULAIMANI (ESTA) — Oil prices edged higher on Tuesday after trading down earlier, looking set to sustain a rally driven by strong demand in the United States.
Brent crude was up 12 cents at $86.11 a barrel at 0534 GMT, after gaining 0.5% on Monday.
U.S. oil gained 1 cent to $83.77 per barrel, having finished unchanged the previous session after testing new highs.
“Forecasts for a colder November have energy traders bracing for a very tight market that will be met [with] unprecedented demand this winter,” Reuters quoted OANDA senior market analysts Edward Moya as saying.
“This oil market will remain tight and that should mean a headline or two away from $90 oil,” he added.
The market will be closely watching U.S. inventory levels this week. Crude oil stockpiles are forecast to have risen by 1.7 million barrels last week, according to Reuters.
“Limited global oil supplies and signs of increasing demand would continue to see elevated crude oil prices,” said Avtar Sandu, senior manager, commodities at Phillip Futures in Singapore, Reuters reported.
He further said traders were also awaiting clarity on the outcome of talks between Iran and Western powers after the United States said efforts were at “crucial phase” to revive a 2015 nuclear agreement with Iran, which could open the way for exports of its crude.
