NEW YORK (Commodity Online): The speculation that US stockpiles of crude oil climbed did not help the bears as the conflict in Gaza continue to rage fanning fears of a potential supply disruption.

“The situation in the Middle East came at a time when there was a risk-on move in the markets, and that fed through into oil,” said Ric Spooner, a chief market analyst at CMC Markets in Sydney to Bloomberg. “At this stage, the fact is that inventory levels and supply capacity are large.”

On the NYMEX, crude oil for January delivery was seen trading at $89.06 a barrel, a loss of 0.24%. On the ICE Futures Europe, Brent Oil for January delivery dipped 0.04% and was seen trading at $111.59 a barrel as of 10.33 am IST. This follows sharp spikes in prices yesterday.

On India's MCX, the commoditie's contract for December delivery was seen trading at Rs.4911 a barrel, a loss of 0.47%.

Meanwhile, leaders including Barack Obama has called for an end to escalating violence. The hopes that US fiscal cliff issue would be resolved is also aiding price spikes.

“There’s an abundance of oil out there,” Jacob Correll, a Louisville, Kentucky-based analyst at Summit Energy Inc., which manages more than $20 billion in companies’ annual energy spending, said yesterday by telephone to Bloomberg. “The numbers don’t lie. They are indicative of good supply and increasing production especially in the Midcontinent.”