By Sara Sjolin, MarketWatch
LONDON (MarketWatch) — Oil prices inched closer to $97 a barrel on Tuesday, as unrest in the Middle East and a refinery closure on the U.S. East Coast stoked supply concerns.
Crude oil for March delivery CLH3 +0.05% rose 14 cents, or 0.2%, to $96.59 a barrel, adding to a 56 cent gain on Monday.
The positive moves came as tensions in the Middle East continued to fuel fears of supply disruptions, as violence escalated in Algeria and Egypt. The hostage crisis in Algeria on Monday led to an attack on one of the country’s pipelines, prompting U.K. oil giant BP PLC UK:BP +0.73% to reconsider plans to restart drilling in neighboring Libya.
“Libya’s plans to increase its oil production to 2 million barrels per day within the next two years are likely to be overly optimistic,” analysts at Commerzbank said in a note.
“What is more, the dispute between the Northern Iraqi province of Kurdistan and the central government in Baghdad threatens to escalate now that the Kurdish provincial government has independently granted exploration rights to the U.S. oil companies Chevron CVX -0.14% and Exxon Mobil XOM -0.68% ,” they added.
In the U.S., news of a refinery closure in the Northeast sparked lower supply forecasts for that region. On Monday, Hess Corp. HES +6.08% said it plans to close its Port Reading, N.J., refinery by the end of February.
Gasoline prices rallied after the announcement, but the February contract RBG3 -0.41% was lately down 0.2% to $2.93 a gallon.
Elsewhere in the energy complex, heating oil for February delivery HOG3 -0.02% gained 0.1% to $3.06 a gallon, while natural gas for the same month slumped 2.2% to $3.217 per million British thermal units.
Sara Sjolin is a MarketWatch reporter based in London. Follow her on Twitter @sarasjolin.
