SINGAPORE: Japanese rubber futures edged up slightly on Tuesday amid stronger oil prices and a weaker yen, even as the market tried to consolidate after a sharp rally last month.

The Osaka Exchange (OSE) rubber contract for September delivery closed up 0.4 yen, or 0.12%, at 325.5 yen ($2.15) per kg. The rubber contract on the Shanghai Futures Exchange (SHFE) for September delivery fell 35 yuan to finish at 14,615 yuan ($2,020.07) per metric ton.

“Prices are currently consolidating and are likely to remain within the range of 305-345 (yen) in the next couple of weeks,” Japan Exchange Group said in a technical analysis of the new active OSE September contract in its weekly strategy report published on Monday, noting that the contract had previously been in an “extremely overbought position”.

Oil prices rose on Tuesday, underpinned by signs that demand may improve in China and the United States, and growing concerns of a widening conflict in the Middle East that could affect supply from the region.

Natural rubber often takes direction from oil prices as it competes for market share with synthetic rubber, which is made from crude oil. The yen weakened overnight to 151.71 against the dollar.