08:47 AM EDT, 08/07/2024 (MT Newswires) -- Oil prices rose early on Wednesday as heightened Middle East tension offset a report showing U.S. oil inventories last week rose for the first time in six weeks and demand from China remained weak.

West Texas Intermediate crude oil for September delivery was last seen up US$1.75 at US$74.95 per barrel, while October Brent crude was up US$1.69 at US$78.17.

The rise comes as Mideast tension remain high, with Iran expected to retaliate against Israel for the assassination of Hamas political leader Ismail Haniyeh in Tehran last week. The Washington Post reported the Biden Administration is moving additional naval assets closer to Israel to defend the country against a attack thought to be imminent.

"Crude oil tries to consolidate after slumping to a seven-month low, with support in Brent around $75 continuing to hold amid ongoing supply concerns and market recovery," Saxo Bank wrote in a report. "Heightened fears of supply disruptions stem from escalating Middle East tensions, particularly Iran's threats against Israel and the U.S."

In its weekly survey, the American Petroleum Institute reported U.S. oil inventories rose by 0.18 million barrels last week. The increase is the first since the week of June 25, but it lagged the consensus forecast for a jump of 0.85-million barrels, according to Investing.com.

Gasoline and distillate inventories were also higher. The Energy Information Administration will release official data later on Wednesday morning.

Weak demand from China, the No.1 importer, has checked prices for oil. Economic data show the country's June oil imports averaged 9.97-million barrels per day, 3% under June, 2023, levels.

"Despite the fact that demand losses due to COVID-19 have yet to recover fully, oil imports have been disappointing this year," ANZ Bank wrote. "That said, lower oil prices and a likely recovery in (refinery) operating rates could boost crude oil imports in the later months of Q3."