LONDON: Oil rose towards $113 a barrel on Tuesday after two days of losses, with tensions in the Middle East and the risk of supply disruptions outweighing concerns about sluggish global demand.
Turkish President Abdullah Gul said on Monday the "worst-case scenarios" between his country and Syria were now playing out, fuelling concerns that the 18-month-old conflict in Syria may spread to other countries in the region.
"Right now the market is concerned about the continuing conflict between Syria and Turkey, and the worry is that, if it escalates, it may disrupt supplies," said Ker Chung Yang, senior investment analyst at Phillip Futures in Singapore.
Brent futures rose 73 cents to $112.55 by 0915 GMT. US crude climbed 48 cents to $89.81, also rebounding after two consecutive sessions of declines.
Tensions between Syria and Turkey are at their worst since March after cross-border firing accidentally killed some Turkish civilians last week, causing Istanbul to boost its military presence along the border.
This could threaten oil production in the north of Iraq and its transport to the West, analysts said.
Concerns over the situation have eclipsed Iran's long-running row with the West over Tehran's disputed nuclear programme that has led to sanctions on Iranian oil shipments.
But a poor outlook for the global economy is keeping a lid on oil price gains.
IMF CUTS FORECAST
The International Monetary Fund cut its global growth forecast for the second time since April and warned US and European policymakers that failure to fix their economic ills would prolong the slump.
For 2012, the IMF now expects global output to grow just 3.3 percent, down from its July estimate of 3.5 percent, making it the slowest year of growth since 2009.
It predicted only a modest pickup next year to 3.6 percent, below its July estimate of 3.9 percent.
Growth in China's economy, the world's second-biggest, will slow to 7.8 percent this year from 9.2 percent in 2011, the IMF said, warning of risks to emerging Asia if the euro zone crisis worsens and the United States does not avoid its "fiscal cliff".
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