Tightening pressure on oil

Oil fell in Asian trading as investors weighed signs the market is tightening amid ongoing concerns about demand. Brent crude fell to $83 a barrel after rising 1.6% in the previous two sessions, at the upper end of a narrow range. U.S. crude traded around $78. Time spreads suggested the market was stronger, while U.S. crude inventories rose less than expected last week. Oil was caught between falling OPEC+ production and rising tensions in the Middle East, as well as concerns about the outlook for consumption in top importer China. “There has been a recurring theme of strong oil demand combined with weak Chinese macroeconomic data. So far, fundamental signals have been mixed,” Michael Tran, an analyst at RBC Capital Markets LLC, said in a note. Attacks by Houthi militants on commercial vessels in the Red Sea have added to the risk premium on oil futures. The group and its Iranian backers are preparing for a protracted conflict with the U.S. and its allies around the waterway, regardless of the outcome of the Israel-Hamas war. U.S. crude inventories rose less than expected and have risen for a fourth week. Inventories in Cushing, Oklahoma, the delivery point for U.S. crude futures, also rose for a second week but remain below seasonal averages.