Oil prices trade with caution as Brent lowers at $71

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The price of European Brent Crude oil rose by 25% in 2017 compared with the previous year, but oil fuel used in construction (Gas Oil/DERV) only rose by 10%.

Usually in the aftermath of any market fear that proves to be a bust, experts look to the longer term for fresh worries, and Morgan Stanley did exactly that on Monday in the wake of the USA missile strikes against Syria being pulled off with far greater success and precision than critics had expected.

The strikes of Saturday marked the biggest intervention by Western countries against the president Syria, Bashar Al-Assad and his ally Russian Federation, who is to face further economic sanctions over its role in the conflict.

Brent crude oil futures were at $71.80 per barrel at 0120 GMT, up 38 cents, or 0.5 per cent from their last close.

Oil fell more than 1 percent on Monday as markets opened following western air strikes in Syria over the weekend, while a rise in USA drilling for new production also dragged on prices. U.S. President Donald Trump has threatened to withdraw the United States from the pact, barring action from Congress and Europe.

Oil fell almost 2% on Monday after USA drilling activity rose and the fear about escalating tension in the Middle East waned following air strikes on Syria at the weekend.

Crude oil prices started the week with a drop of about one percent as traders were still watching what happens in Syria next and despite the announcement that Washington will impose new sanctions on Russian Federation for its support of Syrian President Bashar Assad.

Although Syria itself is not a significant oil producer itself, the wider Middle East is the world's most important crude exporter and tension in the region tends to put oil markets on edge.

Traders said oil markets were receiving general support due to a sense that there were high risks of supply disruptions, including a potentially spreading conflict in the Middle East.

Investors added to their bullish position, which is now almost equal to 640 million barrels of oil in past 9 months.

US companies have added seven signs in the week up to April 13, bringing the total to 815.

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