Oil futures wavered on Tuesday after Libya restarted production at its largest oil field while freezing temperatures across North Dakota continued to impact output.
West Texas Intermediate (CL=F) dropped as much as 1% before moving up towards the flatline midday, trading north of $74 per barrel. Brent futures (BZ=F) were trading near $79 per barrel after rising almost 2% in the prior session.
Libya’s oil production has returned to 1.2 million barrels per day following an interruption of three weeks due to protests.
Traders were also monitoring Russian crude exports impacted by a recent Ukrainian drone strike against a key fuel terminal in the Baltic Sea region. The damaged site has partially resumed exports.
Meanwhile a cold snap across the US recently knocked off production of almost 200,000 barrels of crude per day in North Dakota.
"Still, unless we see escalation of tensions in the Red Sea that actually curtails oil sales, the upside to crude prices looks limited," said Dennis Kissler, senior vice president at BOK Financial, on Tuesday.
The US and UK continued retaliatory strikes on Monday against Houthi-controlled areas in Yemen. The rebels backed by Iran have been targeting vessels making their way through the Red Sea, prompting companies to suspend or reroute their shipments away from the area.
"The disruption in the Red Sea is leading to longer delivery times as a large percentage of ships are continuing to avoid the region," Stephen Schwartz, executive vice president of Wells Fargo global receivables and trade finance, told Yahoo Finance on Monday.
"The risk of impact increases the longer the disruption continues," he added.
Earlier this month Danish oil tanker group Torm (TRMD) said it was pausing all shipments through the southern Red Sea. The company owns more than 80 vessels that transport refined energy products and chemicals.
British oil and gas giant Shell (SHEL) has also said it would avoid the area.
Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X at @ines_ferre.
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