Oil prices were steady on Tuesday as the prospect of additional supply entering the market amid lackluster global demand growth offset concerns that the escalating Middle East conflict could disrupt exports in the key producing region.
Brent crude futures for December delivery increased 13 cents, or 0.18%, to $71.83 a barrel as of 0050 GMT. U.S. West Texas Intermediate crude futures for November delivery gained 11 cents, or 0.16%, to $68.28 a barrel.
Oil markets have been under pressure from weaker-than-expected demand growth this year, particularly in China, the world's biggest crude importer. Those demand concerns were reinforced on Monday after data showed the country's manufacturing activity shrank for a fifth month in September.
On Monday, Brent futures ended September down 9%, its third month of declines and largest monthly drop since November 2022. It slumped 17% in the third quarter for its biggest quarterly loss in a year. WTI fell 7% last month and dropped 16% for the quarter.
Despite the demand worries, escalating tensions between Israel and the Islamic militant group Hezbollah in Lebanon has increased potential for Iran, a key oil producer and member of the Organization of the Petroleum Exporting Countries that backs the militia, to be directly drawn into the conflict and possibly disrupt oil exports from the region.
The Israeli military began limited, localized and targeted raids against Hezbollah targets in the border area of southern Lebanon, it said in a statement early on Tuesday.
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