Global oil prices have jumped on renewed Ukraine tensions after pro-Russian protesters seized government buildings in the eastern city of Donetsk.
New York’s West Texas Intermediate (WTI) for delivery in May surged $US2.12 ($A2.29) to $US102.56 ($A111.00) per barrel, its highest level in one month.
Brent North Sea crude for May gained $US1.85 to $US107.67 a barrel in London trade.
“Oil is firming in reaction to heightened tensions in Ukraine, where Russia has warned of civil war if Kiev asserts military control in the eastern part of the country,” said Addison Armstrong, senior director of market research for Tradition Energy.
NATO’s chief on Tuesday warned Russia against further intervention in Ukraine, urging Moscow to “step back” after pro-Kremlin militants seized government buildings in several cities in the east.
Pro-Russia activists have seized state buildings in the eastern cities of Kharkiv, Lugansk and Donetsk, where they have vowed to vote on joining Russia in an eerie echo of last month’s situation in Crimea, a Black Sea peninsula in Ukraine that has since been annexed by Moscow.
“Unsettling news continues to come out of east Ukraine,” said Commerzbank analyst Carsten Fritsch.
“Any further escalation of the situation would intensify tensions between Russia and the West and could lead to tighter sanctions being imposed on Russia,” he said.
“So far, the market appears to believe this to be unlikely, though that means the (oil) price would react all the more strongly if sanctions actually were imposed on the Russian oil and gas sector.”
Russian deliveries account for 34 per cent of the natural gas supplies to the European Union, according to the Soufan Group, a US-based intelligence firm.
The Ukraine worries beat back good supply news from Libya, where rebels agreed Sunday to allow the reopening of two of four oil terminals they have blockaded since July.
The deal allows for the immediate reopening of the Zueitina and Al-Hariga terminals, which have a combined oil export capacity of 210,000 barrels per day.