Oil dips as investors eye Israel-Gaza truce talks, U.S. Fed policy review [Video]

Oil edged down in early trade on Tuesday after Israel-Hamas ceasefire talks in Cairo helped quell market fears of an expanded conflict in the Middle East, while worries about the outlook for U.S. interest rates weighed on the market.

Brent crude futures dipped 5 cents, or 0.06%, to $88.35 a barrel at 0006 GMT, and U.S. West Texas Intermediate crude futures slipped 12 cents, or 0.15%, to $82.51 a barrel.

The front-month contract of both benchmarks lost more than 1% on Monday.

Hamas negotiators left Cairo late on Monday to consult with the group’s leadership after talks with Qatari and Egyptian mediators on a response to a phased truce proposal that Israel presented on the weekend.

The delegation was expected to report back within two days, two Egyptian security sources said.

While Hamas leaders visited Cairo, Israeli airstrikes killed dozens of Palestinians on Monday, with more than half the dead in the southern Gaza city of Rafah, which foreign leaders have urged Israel not to invade.

Continued attacks …