Brent crude edges up as tensions in Middle East continue

Oil drilling rigs

Brent crude eked out a small gain in early session today, Jan. 15, as geopolitical tensions continue to simmer in the Middle East, threatening global energy supplies.

International benchmark Brent crude rose 0.15% to $78.41 a barrel, at 09:00 am Makkah time. West Texas Intermediate (WTI) crude was trading at $72.72 a barrel, after dropping 1.55% last week.

"There are supply risks for the market given the escalation in (the) Red Sea," said Warren Patterson, Head of Commodities Research at ING, according to a Reuters report.

"However, for now we are not seeing any impact on oil supply," he added.

Goldman Sachs analysts said in a note that while the conflict in the Middle East does not affect oil production, the geopolitical risk premium appears moderate at present, given the fluctuations in options contracts. It is expected that oil prices will increase by 20% during the first month in case of any disturbance in the Strait of Hormuz, the note said, adding that this possibility is weak.