PERTH, July 3 (Reuters) - Oil prices edged higher on Friday ahead of a long U.S. holiday weekend, amid cautious optimism about efforts to establish peace in the Middle East between the United States and Iran.

Brent crude futures rose 17 cents, or 0.24 percent, to $72.10 a barrel by 0155 GMT. U.S. West Texas Intermediate crude futures gained 14 cents, or 0.20 percent, to $68.83 a barrel.

US markets will be closed today, Friday, ahead of the Independence Day holiday tomorrow, Saturday.

During the previous session, both benchmarks hit their lowest levels since before the outbreak of the US-Israeli war on Iran in late February. Brent crude is down 0.02 percent so far this week, while West Texas Intermediate is up 0.12 percent, their narrowest weekly movements in months.

Tim Waterer, chief market analyst at KCM Trade, said, "It's a case of cautious optimism, as the market wants to believe that the peace efforts will hold, but it is still hedging its bets until it sees real evidence on the ground."

Some countries are working to increase production as the Strait of Hormuz reopens, through which, before the war, one-fifth of the world’s oil and liquefied natural gas supplies passed.

Kuwait's oil production rose sharply to 1.65 million barrels per day in June from 580,000 barrels per day in May, a source familiar with the matter told Reuters on Thursday, after the OPEC member boosted exports following the interim peace agreement between the United States and Iran.

According to trade sources and shipping data, at least five supertankers carrying a total of 10 million barrels of Saudi oil have left the Strait of Hormuz, and Saudi Aramco has switched to spot pricing to accelerate sales in Asia.