New York's main contract, West Texas Intermediate (WTI) for April delivery, gained USD 1.20 to USD 103.79 in mid-morning trade, and Brent North Sea crude for April jumped USD 1.48 to USD 110.55. (Agencies)
Lawmakers in Moscow voted on Saturday to allow President Vladimir Putin to send troops into Crimea, a predominantly Russian-speaking peninsula in the southeast of Ukraine following the ouster of its pro-Russian government last week.
In what has become the most serious crisis since the end of the Cold War, global leaders condemned the move as Ukraine's new Prime Minister, Arseniy Yatsenyuk, warned, "We are on the brink of a disaster."
Desmond Chua, market analyst at CMC Markets in Singapore, said that the escalating tension in Ukraine is providing strong support for oil prices.
"Considering that Ukraine is part of the supply chain for Brent, we are looking at this pent-up risk premium resulting in overshooting prices," Chua said.
"Right now we would have our eyes on Ukraine, on the situation in Crimea. I do think that at least for the next couple of days this situation will be superseding any other market data," Chua added.
Gunmen believed to be acting under Kremlin orders have already tightened their grip on Crimea, seizing government buildings and surrounding Ukrainian military bases.
JP Morgan Commodities Research analysts noted that Ukraine is neither a major oil producer nor oil consumer but it said it is an important transit country for Russian energy exports.
More than 70 percent of Russia's gas and oil flows to Europe pass through its territory. In turn, Europe is the buyer for nearly 90 per cent of Russia's oil exports.
New York's main contract, West Texas Intermediate (WTI) for April delivery, gained USD 1.20 to USD 103.79 in mid-morning trade, and Brent North Sea crude for April jumped USD 1.48 to USD 110.55.