SINGAPORE: Oil prices rose in Asia on Tuesday but gains were capped as dealers sat on the sidelines eyeing negotiations aimed at ending a strike at some US crude refineries, analysts said.
US benchmark West Texas Intermediate rose 36 cents to $49.95 while Brent crude gained 89 cents to $60.43 in afternoon trade.
Talks to settle a strike by workers at three major US refineries operated by Royal Dutch Shell are set to restart Wednesday following a stalemate on February 20.
More than 5,000 workers spread across around a dozen installations have been on strike since February 1 demanding improved wages and safety conditions.
Daniel Ang, investment analyst at Phillip Futures in Singapore, said oil prices are “trading rangebound” ahead of the talks.
With storage space for unprocessed crude “reaching full capacity” at the key Cushing Oklahoma, oil storage hub, oil majors could be compelled to reach a speedy conclusion to the dispute, Ang said.
The strike affects facilities accounting for about 13 percent of the processing capacity in the world’s top crude consumer, according to Bloomberg News.
Nicholas Teo, market analyst at CMC Markets in Singapore, said dealers were also monitoring fresh marathon talks in Switzerland between the US and crude producer Iran over Tehran’s controversial nuclear program.
The Islamic republic has been crippled by a series of UN and US sanctions, including on crude exports, aimed at bringing an end to its nuclear drive, which the West claims is being used to develop atomic weapons. Iran denies the claims.