Stock Saudi Aramco refinery
The Organisation of Petroleum Exporting Countries (OPEC) and allies have agreed to curb supplies from November, ahead of European Union sanctions on Russian oil flows the next month. Photo shows an oil tanker being loaded at Saudi Aramco's Ras Tanura oil refinery and oil terminal in Saudi Arabia. Image Credit: Reuters

Oil edged higher on concern about near-term supply tightness, and as a raft of positive US earnings supported appetite for risk.

West Texas Intermediate (WTI) rose toward $85 a barrel in early Asian trading after dropping in the prior two sessions.

The Organisation of Petroleum Exporting Countries (OPEC) and allies have agreed to curb supplies from November, ahead of European Union sanctions on Russian oil flows the next month.

Key market time spreads — a gauge of tightness — remain in backwardation, a bullish pattern.

On course for 5th monthly gain

Crude has swung in recent sessions along with broader market trends and shifts in the dollar. The US currency was slightly weaker on Tuesday, making commodities cheaper for overseas buyers. A fifth of S&P 500 companies have posted third-quarter earnings so far, with more than half topping estimates.

Oil is on course for the first monthly gain since May, although prices have shed the advances that followed Moscow's invasion of Ukraine. Investors are weighing concerns about the impact of global economic slowdown and tighter monetary policy against the scope for a reduction in supply. They're also awaiting further details on a US-led plan to cap the price of Russian oil.

Among widely watched time spreads, the difference between Brent's first and second-month contracts was $1.99 a barrel in backwardation, compared with $1.43 a week ago, and 88 cents two months ago.

Similarly, the gap between the contract for this coming December and the final month of 2023 is well above $12, more than twice the level in mid-August.

The relatively solid market signals come despite a poor economic outlook for China, the top crude importer, which has added to headwinds.

The country's third-quarter GDP showed a mixed recovery, with strict COVID-19 controls and a property slump continuing to weigh on growth and, hence, oil demand.