LONDON: Global oil prices held above $115 a barrel on Thursday after US President Barack Obama won some support from lawmakers for a military strike on Syria, adding to concerns that Middle East supply disruptions will persist.
Brent crude oil prices are unlikely to rise steeply, given expectations for a short, limited strike on Syria, unless the situation goes out of control and key oil producers in the Middle East get dragged into the conflict.
Gains may also be limited as investors await details of possible moves by the US Federal Reserve to roll back stimulus, which would strengthen the dollar and weigh on commodities.
Brent crude rose 44 cents to $115.35 a barrel by 0807 GMT. US oil gained 57 cents to $107.80 a barrel.
"My central view is that Middle East premiums will remain in the market for a while," said Ric Spooner, chief market analyst at CMC Markets.
"If you take it that the United States will attack, the key question remains what happens after that? Will it stay limited, or will Syria's neighbours get dragged in?"
Investors expect any strike to be limited. The Senate Foreign Relations Committee voted in favour of a resolution that sets a 60-day limit on any engagement in Syria, with a possible 30-day extension, and bars the use of US troops for ground combat.
While Syria is not a big oil producer, investors have been worried that a strike there by Western forces may disrupt supplies from a region that pumps a third of the world's crude.
Markets are already struggling to cope with a loss of supplies from Libya. Outages in the Middle East and Africa have surpassed 3 million barrels per day, or about 3.5 percent of global demand.
"Syria is making a lot of headlines but the market is really about Libya," said Olivier Jakob, analyst at Petromatrix.
"It is very difficult to forecast and it could as easily go back to normal tomorrow or not. But the reality is that the amount of oil coming out of Libya is very small".
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