SINGAPORE- Oil prices dipped on Wednesday after industry data showed US crude inventories swelled more than expected, though declines were capped as the market watched diplomatic efforts in the Middle East after Israel continued attacks on Gaza and Lebanon.
Brent crude futures dipped 20 cents, or 0.3 percent, to $75.84 a barrel. US West Texas Intermediate crude futures shed 20 cents, or 0.3 percent, to $71.54 a barrel.
Crude futures settled higher in the two previous sessions this week.
“The market continues to wait for Israel’s response to Iran’s missile attack,” ING analysts said on Wednesday, adding the price strength on Tuesday was possibly due to the lack of outcome from US Secretary of State Antony Blinken’s latest visit to Israel.
Blinken held “extended conversations” with Israeli Prime Minister Benjamin Netanyahu and senior Israeli leaders, urging them to get more humanitarian aid into Gaza, a senior State Department official said.
Israel on Tuesday also confirmed it had killed Hashem Safieddine, the heir apparent to late Hezbollah leader Hassan Nasrallah who was killed last month in an Israeli attack targeting the Iran-backed Lebanese militant group.
“Market participants priced for the Middle East conflict to drag for longer, with a ceasefire deal potentially seeing some gridlock,” said Yeap Jun Rong, market strategist at IG.