Oil prices hovered near $40 a barrel Tuesday in Asia on investor concerns the conflict between Israel and Hamas could further heighten tensions in the oil-rich Middle East, the Associated Press reported. Light, sweet crude for February delivery fell 16 cents to $39.89 a barrel in electronic trading on the New York Mercantile Exchange by late afternoon in Singapore. The contract overnight rose $2.31 to settle at $40.02. Hamas sent missiles deep into Israel on Monday, three days into Israel's punishing air offensive in Gaza. Four Israelis, including a soldier, were killed and eight wounded. Palestinian health officials put the three-day death toll in Gaza at 364; the U.N. said the total included at least 62 civilians. Early Tuesday, Israeli aircraft dropped at least 16 bombs on five Hamas government buildings in a Gaza City complex, destroying them, witnesses said. Crude prices have rallied 14 percent since Friday. Oil prices have fallen 73 percent since peaking at $147.27 a barrel on July 11. The Organization of Petroleum Exporting Countries, which accounts for about 40 percent of global supply, has announced production cuts totaling more than 4 million barrels per day in the last few months. In other Nymex trading, gasoline futures rose 0.15 cent to 88 cents a gallon. Heating oil fell 0.83 cent to $1.28 a gallon while natural gas for February delivery was steady at $6.08 per 1,000 cubic feet. In London, February Brent crude fell 11 cents to $40.44 a barrel on the ICE Futures exchange.
