SINGAPORE: Brent futures on Tuesday traded near a four-month low touched overnight, but worries over a prolonged outage from oil exporter Libya helped the benchmark hold above $106 a barrel.
Heavy shooting erupted early on Tuesday in the Libyan capital, Tripoli, the latest surge in unrest in the OPEC producer that highlights the government's inability to control militia groups. Brent crude edged 9 cents higher to $106.32 a barrel at 0342 GMT, after hitting a four-month low of $105.13 overnight. US oil gained 10 cents to $94.72, also having slumped to a four-month low in the earlier session.
"Oil is looking for a bottom, and the downside we are seeing now is quite temporary," said Tetsu Emori, a commodities fund manager at Astmax Investments.
"The outage in Libya is keeping the demand-supply balance quite tight as we head into the peak heating oil demand season."
Emori expects oil to trade in a tight range ahead of key data from the United States, including GDP and employment later this week, which will give investors a clearer view of the demand outlook for the world's biggest oil consumer.
Investors are also waiting for these US numbers to gauge when the Federal Reserve may start to roll back its monetary stimulus.
A cutback would reduce the supply of dollars, boosting the currency and making dollar-denominated assets such as oil more expensive for holders of other currencies.
Comments by top Fed officials overnight showed that a cut-back in the stimulus was not imminent.
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