Oil prices rose on Monday on worries about supply disruption amid rising tensions in Eastern Europe and the Middle East, which could make an already tight market even tighter, while OPEC and its allies continued to struggle to raise output.
Brent crude futures rose 58 cents, or 0.7 percent, to $88.47 a barrel by 0742 GMT, reversing a 0.6 percent loss on Friday.
U.S. West Texas Intermediate (WTI) crude futures gained 57 cents, or 0.7 percent, to $85.71 a barrel, having fallen 0.5 percent on Friday.
Both benchmarks rose for a fifth week in a row last week, gaining around 2 percent to hit their highest since October 2014. Prices are already up more than 10 percent this year on the concerns over tightening supplies.
“Investors remained bullish due to geopolitical risk between Russia and Ukraine as well as in the Middle East, while OPEC+ continued to fail to reach its output target,” said Kazuhiko Saito, chief analyst at Fujitomi Securities Co Ltd.
Fueling fears of supply disruption in Eastern Europe, the New York Times reported late on Sunday that U.S. President Joe Biden was considering deploying several thousand U.S. troops to NATO allies in Eastern Europe and the Baltics.
In the Middle East, the United Arab Emirates intercepted and destroyed two Houthi ballistic missiles targeting the Gulf country on Monday with no casualties, its defense ministry said, following a deadly attack a week earlier.
OPEC+, which groups the Organization of the Petroleum Exporting Countries (OPEC) with Russia and other producers, is struggling to hit its monthly output increase target of 400,000 barrels per day (bpd).
“Expectations that OPEC+ members such as Saudi Arabia and Russia are likely to keep the current policy of gradual increase of output to maintain Brent oil prices between $85 and $90 a barrel are providing support to an overall sentiment,” said Tetsu Emori, CEO of Emori Fund Management Inc.