Oil maintains last week’s gains driven by tensions in the Middle East and economic data

By Colleen Howe

BEIJING (Reuters) – Oil prices remained little changed in early Asian trading on Monday, maintaining most of last week’s gains of more than 3%, supported by geopolitical tensions and better economic data.

Brent crude futures were down 7 cents, or 0.09%, at $79.59 a barrel by 0021 GMT, while U.S. West Texas Intermediate crude futures were up 2 cents, or 0.03%, at U.S. $76.86.

“Traders continue to pay attention to simmering tensions in the Middle East,” ANZ analysts said in a note.

The risk of an escalation in the Israeli-Palestinian conflict continued to support prices after Iran and Hezbollah promised to retaliate for the assassinations of Hamas leader Ismail Haniyeh and Hezbollah military commander Fuad Shukr.

The Israeli incursion into Gaza intensified on Saturday with an airstrike on a school complex that killed at least 90 people, according to the Gaza Civil Emergency Service, although Israel said the death toll was inflated. Hamas cast doubt on its participation in new ceasefire negotiations on Sunday.

Brent ended last week up more than 3.5%, while WTI gained more than 4%, due to favorable economic data and rising hopes of a US interest rate cut.

Three U.S. central bankers said last week that inflation appeared to be cooling enough for the Federal Reserve to cut interest rates as early as next month.

Consumer prices in China rose faster than expected in July, and weekly jobless claims in the US fell more than expected last week.

(Reporting by Colleen Howe; Editing by Jamie Freed)