Oil steady on Egypt, US inventories eyed

Oil was steady ahead of the latest reading of weekly inventory levels in the United States due later on Tuesday, supported by uncertainty over Egypt's future

ICE Brent LCOc1 rose 37 cents to $99.62 a barrel. U.S. crude (WTI) for March CLc1 was flat at $87.48 a barrel by 0934 GMT.
Although the tension in Egypt will continue to lend support to prices, analysts did not expect to see very strong geopolitical risk premiums in crude futures in the near term.
"The prices are consolidating, slightly below their previous levels, with Egypt unable to drive the prices upwards anymore, but the insecurity related with it prevents further declines," Commerzbank analyst Carsten Fritsch said.
"(Egypt) will be (in focus) until we are clear that negotations are progressing, but tensions eased so certainly the latest pullback had seen a somewhat diminishing geopolitical risk premium," Andrey Kryuchenkov at VTB Capital said.
Although a small oil and gas exporter itself, Egypt is key for global crude and oil product flows through the Suez canal and the Suez-Mediterranean (Sumed) pipeline, which remained unaffected by the protests.
U.S. crude inventories were expected to rise for the fourth consecutive week, according to a Reuters poll, with industry body American Petroleum Institute to release weekly data.
The U.S. government's Energy Information Administration will follow with its own report on Wednesday.
"The data is expected to be bearish for the market, showing further build up in inventories and squeezing the WTI margins and putting more pressure on the oil prices," Commerzbank's Fritsch added.
Another build in crude stockpiles at the delivery hub of Cushing, Oklahoma, could drive stocks to new highs after rising to a record 38.33 million barrels in the week to Jan. 28, based on data from the EIA.
"U.S. crude stocks provide forward demand cover for 24 days, the highest seasonal level since 1994 while total product inventories are similarly swollen," JBC wrote in a note.