Oil falls as Trump downplays prospect of escalation with Iran

Oil prices edged lower on Tuesday, extending losses from the previous day, after US President Donald Trump said US military action against Iran is not necessary "at this point", easing concerns about prolonged disruptions to Middle East supply.

Brent crude futures fell 24 cents, or 0.23%, to $92.33 a barrel by 0102 GMT, while US West Texas Intermediate (WTI) futures fell 35 cents, or 0.40%, to $86.50 a barrel.

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Brent settled down 5.85% in the previous session after sliding to its lowest since August 31.

Trump said on Monday he plans to hold off on new military strikes against Iran for the time being after appeals from countries in the region, including from Qatar's prime minister in White House talks.

Trump, in a Reuters interview and a later appearance in the White House press briefing room, said he plans to keep up a naval blockade in the Strait of Hormuz for now.

"The market continues to prioritise President Trump's more conciliatory tone toward Iran since the midterms," said Tim Waterer, chief market analyst at KCM Trade.

"While attacks on shipping around the Strait of Hormuz are still occurring, they have not escalated in a way that has forced a fresh risk premium into the market," he said.

Senior US and Gulf officials have cast doubt on the chances of any imminent peace deal between Washington and Tehran.

Iranian security council chief Mohsen Rezaei said the US should "stop manufacturing fake news about imaginary talks" and that it was "time to surrender to the seven conditions Iran has repeatedly set out."

On the supply side, OPEC oil output rose in October, a Reuters survey found, led by gains in Saudi Arabia, Kuwait and Iraq despite continued constraints on exports.

Elsewhere, Russian and Ukrainian officials planned to meet on Tuesday for two days of US-brokered talks - their first since February - after Trump suggested last week that a broad peace deal was possible in their 4-1/2-year-old war and could incorporate Europe's security.