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Oil prices held steady on Tuesday as a weaker demand outlook offset lingering concerns about possible supply disruptions in the Middle East.

Benchmark Brent crude traded virtually unchanged at $63.26 a barrel after rising over 1 percent in the previous session on fears of supply disruptions from the energy-rich Gulf. West Texas Intermediate (WTI) crude futures were marginally higher at $56.27 per barrel.

The International Energy Agency (IEA) pledged to keep global markets adequately supplied in the event of a disruption.

The oil market is currently well supplied, with oil production exceeding demand in the first half of 2019, pushing up global stocks by 900,000 barrels per day, the IEA said in a statement.

Meanwhile, amid heightened tensions in the Persian Gulf, the head of Iran's navy, Rear Admiral Hossein Khanzadi, reportedly said today that Tehran is observing all U.S. ships in the Gulf region and keeps an archive of their movements.

"We observe all enemy ships, particularly [those of] America, point by point from their origin until the moment they enter the region," Khanzadi said.

Elsewhere, the United States has slapped sanctions on a Chinese company for importing Iranian crude in violation of U.S. restrictions on Iran's oil industry.

U.S. Secretary of State Mike Pompeo said the sanctions are "part of our maximum pressure campaign" on Iran.

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