- POSTED: 09 Oct 2013 04:09
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Oil prices Tuesday edged higher as a US budget impasse continued and some production outages lingered in key Middle Eastern oil producers.
NEW YORK CITY: Oil prices Tuesday edged higher as a US budget impasse continued and some production outages lingered in key Middle Eastern oil producers.
US benchmark West Texas Intermediate for November delivery rose 46 cents to US$103.49 a barrel on the New York Mercantile Exchange.
European benchmark Brent oil put on 48 cents to reach US$110.16 a barrel.
Markets remain fixated on Washington, where Democrats and Republicans continue to bicker over a partial government shutdown and raising the debt ceiling ahead of an October 17 deadline.
The WTI benchmark has been trading in a tight range of US$101.50-US$104.50, said Addison Armstrong, senior director of market research at Tradition Energy.
"The lack of movement is entirely correlated with the lack of progress in Washington," Armstrong said.
Matt Smith, an analyst at Schneider Energy, said Tuesday's rise reflects the market's assumption that "by hook or by crook we will see a resolution to the current government issues faced."
Political and social strife in key Middle Eastern oil producers has also created support for oil.
Eurasia Group analyst Greg Priddy pointed to "continuing uncertainty" about Iraq, where some production is off line, as well as ongoing shutdowns of production in Eastern Libya that "are not likely to be reversed immediately."
Priddy also pointed to other bearish factors, including the rise of crude production in the fourth quarter from countries not in the Organization of Petroleum Exporting Countries.
The short-term risks on oil are "primarily to the downside," Priddy said.
Investors will keep watch at Wednesday's weekly US oil inventory report. Analysts project an increase in stocks of 1.4 million barrels, according to a survey by Dow Jones Newswires.