Oct 27 (Reuters) - Oil prices edged lower on Tuesday as the potential for a resolution in the US-Israeli war on Iran kept supply fears at bay, but Brent stayed close to six-month highs as attacks on Saudi Arabia lowered hopes of immediate stability in the region.
Brent crude futures were down 66 cents, or 0.57%, at $115.15 a barrel as of 0000 GMT, while US West Texas Intermediate crude was down 44 cents, or 0.43%, at $101.32.
Saudi Arabia, Turkey and Pakistan held talks with Iranian officials in Tehran
on Monday aimed at easing tensions in the Middle East. Saudi Arabia said the visit sought to establish open negotiating channels to "prevent the return of military escalation". The four countries agreed to continue talks with a view to strengthening cooperation in peace and security, Iranian state media reported.
Hopes of resolution in the conflict erased some fears of supply disruption, lowering risks and pressuring oil prices.
However, losses were limited as scope for peace looked fragile, with renewed attacks by Iran-aligned Houthis on key producer Saudi Arabia.
October has been the worst month for attacks on commercial shipping in the Strait of Hormuz and nearby waterways, according to data compiled by a Washington-based think tank that has tracked maritime security incidents worldwide since 2017.
The war has rippled across the Middle East, placing the Strait of Hormuz at the center of the turmoil. The narrow waterway carried around a fifth of the world's energy supplies before the conflict erupted in February.
Last week, Brent prices surged to more than $117 a barrel, the highest level since April, after a wave of Iranian attacks on tankers around the strait. Brent prices touched $117 on Monday as well.
Elsewhere, Russian refiners are raising diesel production in October after the government granted export quotas following the Kremlin's supply agreement with the US, two industry sources close to the matter said.
(Reporting by Anjana Anil in Bengaluru; editing by Lincoln Feast.)
