Oil prices edged up to their highest in two weeks on Tuesday as sanctions raised concerns about Russian and Iranian oil supplies and tensions in the Middle East escalated, outweighing concerns that trade tariffs would raise inflation and hurt global economic growth.

Brent crude futures rose $1.13, or 1.5%, to settle at $77.00 a barrel, while U.S. West Texas Intermediate (WTI) crude gained $1.00, or 1.4%, to settle at $73.32.

That sent both crude benchmarks up for a third day and to their highest close since Jan. 28.

"With U.S. pressure on Iranian exports and sanctions still squeezing Russian flows, Asian crude quality remains firm and underpinning yesterday's rally," said PVM oil analyst John Evans. U.S. sanctions targeting tankers, producers and insurers have significantly disrupted Russian oil shipments to major importers China and India.

U.S. sanctions on Iran's oil shipping network to China also supported crude prices after U.S. President Donald Trump reinstated "maximum pressure" on Iranian oil exports last week.

Supply concerns have been compounded by the possibility of renewed fighting in the oil-rich Middle East.

Israeli Prime Minister Benjamin Netanyahu said that if Hamas does not release Israeli hostages by noon Saturday, the fragile ceasefire in Gaza will end. The comments followed Trump's demand on Monday that Hamas release all hostages by noon Saturday or he would propose scrapping the Israel-Hamas ceasefire and "let chaos ensue."

Trump also said he might withhold aid to Jordan and Egypt if they do not accept Palestinian refugees relocated from Gaza. Trump is due to meet with Jordan's King Abdullah on Tuesday.

Source: Investing.com