After yesterday's steep fall, oil prices edged higher on Tuesday, as diplomatic efforts continue towards halting the fighting between Israel and militants in Lebanon. Light, sweet crude for August delivery inched to US$75.36 a barrel as of midmorning in Singapore in electronic trading on the New York Mercantile Exchange.
Mounting violence between Israel and militants in Lebanon over the weekend heightened fears of a full-blown war, adding to the existing geo political factors such as the West's nuclear standoff with Iran, threats of supply disruptions in Nigeria and the Gulf of Mexico hurricane season. Other unsolved persistent issues are strong gasoline demand in the U.S. and possible sanctions on Iran for its nuclear ambitions.
Israel is to be presented with "concrete ideas" by the UN to end the fighting after meeting with Lebanon's prime minister. A senior Israeli official said Israel would agree to a cease-fire if Hezbollah's guerrillas withdraw from border area with Israel and release two captured Israeli soldiers. These factors prompted Monday's sharp fall in the price of crude oil, but the decline would likely be limited.
18-Jul-06 
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