Oil rises amid rising tensions in the Middle East

Oil prices rose in Asian trading on Wednesday amid rising tensions in the Middle East, but falling demand capped gains.

Brent crude futures were up 17 cents, or 0.16 percent, at $76.60 a barrel by 0615 GMT. U.S. West Texas Intermediate crude was up 17 cents, or 0.23 percent, at $73.37.

Hamas announced yesterday, Tuesday, the selection of Yahya Sinwar as head of its political bureau, succeeding Ismail Haniyeh, who was assassinated in the Iranian capital, Tehran, last week.

Chinese trade data supported the bearish view on demand, showing that daily crude oil imports in July fell to their lowest level since September 2022.

The broader recovery in prices came after they fell earlier in the trading session, following US data showing an unexpected increase in crude oil and gasoline inventories.

U.S. crude, gasoline and distillate stockpiles rose last week, market sources said Tuesday, citing figures from the American Petroleum Institute.

Gasoline stocks rose by 3.313 million barrels, compared with analysts' expectations for a 1 million-barrel decrease, while distillate stocks rose by 1.217 million barrels, a larger-than-expected increase.

The US Energy Information Administration is due to release weekly inventory data at 1430 GMT on Wednesday.

Iran has vowed revenge on Israel following the assassination of Hamas's political chief in Tehran and a senior commander in Lebanon's Hezbollah group in Beirut, raising fears of a wider war in the Middle East.

Any escalation of the conflict in the Middle East could increase the risk of supply disruption from the region, said Daniel Hynes, an analyst at ANZ.

The decline in production at Libya's Sharara oil field, which has a production capacity of 300,000 barrels per day, is also exacerbating concerns about supply shortages.

Global oil inventories fell by about 400,000 barrels per day in the first half of the year, according to estimates from the U.S. Energy Information Administration released Tuesday. The administration expects inventories to fall by about 800,000 barrels per day in the second half.