Oil holds last week’s gains supported by Middle East tensions, economic data By Reuters

By Colleen Howe

BEIJING (Reuters) – Oil prices were little changed in early Asian trade on Monday, holding on to most of last week’s more than 3 percent gains, buoyed by geopolitical tensions and better economic data.

Futures were down 7 cents, or 0.09 percent, at $79.59 a barrel by 0021 GMT, while U.S. West Texas Intermediate crude futures were up 2 cents, or 0.03 percent, to $76.86.

“Traders remain aware of simmering tensions in the Middle East,” ANZ analysts said in a note.

The risk of an escalation in the Israeli-Palestinian conflict continued to support prices after Iran and Hezbollah vowed to retaliate for the assassinations of Hamas leader Ismail Haniyeh and Hezbollah military commander Fuad Shukr.

Israel’s incursion into Gaza intensified on Saturday with an airstrike on a school compound that killed at least 90 people, according to the Gaza Civil Emergency Service, although Israel said the death toll was inflated. Hamas has cast doubt on its participation in the new ceasefire talks on Sunday.

Brent ended last week up more than 3.5% on the week, while WTI gained more than 4% on supportive economic data and heightened hopes of a US interest rate cut.

Three US central bankers said last week that inflation appeared to have cooled enough for the Federal Reserve to cut interest rates as soon as next month.

China’s consumer prices rose faster than expected in July and weekly US jobless claims fell more than expected last week.