Oil fell Tuesday as warm weather continued to blanket the northeast U.S., but prices remained supported by worries Iran might disrupt oil flows in response to the U.N. Security Council's decision to impose sanctions on it.
U.S. crude for February delivery lost 81 cents to $61.60 a barrel on the New York Mercantile Exchange.
Public holidays across Europe meant trading volumes were very thin.
After months of deadlock, the Security Council agreed Saturday to impose sanctions on Iran's trade in nuclear materials and technology, drawing a warning from Tehran.
"If necessary, Iran will use any weapon to defend itself," Oil Minister Kazem Vaziri-Hamaneh was quoted as saying by the semi-official Fars news agency on Tuesday. In the past he has said Iran would rather not play the oil card.
Iran, the world's fourth-largest crude producer, has condemned the U.N. resolution as illegal and on Sunday vowed to speed up enrichment work, which could heighten tensions.
Oil prices rose earlier in the year because of fears Iran might cut its oil exports or disrupt Gulf shipping as its row with the West over its nuclear program escalated. The issue had faded since summer as the U.N. appeared unable to agree on how to deal with Tehran.
But analysts said traders might disregard the latest developments unless they saw evidence of supply disruption.
"It is certainly a bullish factor, but I think geopolitical matters will be ignored unless clearer risks materialize," said Makoto Takeda, energy analyst at Bansei Securities Co.
U.S. crude for February delivery lost 81 cents to $61.60 a barrel on the New York Mercantile Exchange.
Public holidays across Europe meant trading volumes were very thin.
After months of deadlock, the Security Council agreed Saturday to impose sanctions on Iran's trade in nuclear materials and technology, drawing a warning from Tehran.
"If necessary, Iran will use any weapon to defend itself," Oil Minister Kazem Vaziri-Hamaneh was quoted as saying by the semi-official Fars news agency on Tuesday. In the past he has said Iran would rather not play the oil card.
Iran, the world's fourth-largest crude producer, has condemned the U.N. resolution as illegal and on Sunday vowed to speed up enrichment work, which could heighten tensions.
Oil prices rose earlier in the year because of fears Iran might cut its oil exports or disrupt Gulf shipping as its row with the West over its nuclear program escalated. The issue had faded since summer as the U.N. appeared unable to agree on how to deal with Tehran.
But analysts said traders might disregard the latest developments unless they saw evidence of supply disruption.
"It is certainly a bullish factor, but I think geopolitical matters will be ignored unless clearer risks materialize," said Makoto Takeda, energy analyst at Bansei Securities Co.
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