NEW YORK (CNNMoney.com) -- Oil rose slightly Tuesday after falling from a five-week high hit in the previous session.
Crude oil for February delivery rose 10 cents to settle at $78.87 a barrel in thin trading during a holiday-shortened week. It settled Monday at $78.77 a barrel, after touching $79.12, the highest since Nov. 23, when it hit $79.92.
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Prices were pressured earlier on Tuesday by a firmer dollar, which edged higher against the yen. Crude oil, like other commodities, is priced in dollars, and a stronger greenback weighs on prices.
But the modest movement is particularly insignificant since the market is so thinly traded between the Christmas and New Year's holidays, said energy economist James Williams, president of WTRG Economics. He said prices will continue to bounce around in a tight range.
Looking ahead, Williams said geopolitical issues could move prices.
"The biggest concern is right now is the al Qaeda group in Yemen," he said. "They really don't like the Saudi Arabian government, and if they were able to stage an attack on a Saudi pipeline, that would have the biggest short-term consequence."
A broken pipeline would only take a week to repair, said Williams, but the bust would push oil prices higher.
He added changes in the Middle East politics could also decrease prices.
"Stability in Iraq creates the biggest potential for lower oil prices in the longer term because Iraq has a lot of undeveloped reserves and unexplored territory," Williams said. "Peace would allow the development of Iraqi oil fields, which could triple its production within a five-year period -- it could rival Saudi Arabia."
Barring any major political developments, however, Williams expect oil prices to trade between $70 and $80 in the early part of 2010.
"The outlook for the economy is a slow, slow recovery for a while," he said. "That doesn't create an environment for soaring prices."
Gasoline prices. The national average for a gallon of regular unleaded gasoline increased to $2.608, up 0.5 cent from the previous day's price of $2.603, according to motorist group AAA. It was the fifth consecutive increase. 
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