Brent and U.S. crude oil rallied more than $2 per barrel to multi-month highs on Monday, lifted by rising tension in Ukraine after Russian President Vladimir Putin declared he had the right to invade his neighbour.
Russia is the world's biggest oil producer and Ukrainian Prime Minister Arseny Yatseniuk said Moscow's move to use military force was a "declaration of war".
Putin secured permission from his parliament on Saturday to use military force to protect Russian citizens in Ukraine and told U.S. President Barack Obama he had the right to defend Russian interests and nationals, spurning Western pleas not to intervene. U.S. crude futeres jumped as much as $2.06 to $104.65 a barrel, the highest since Sept. 23. Futures were up $1.77 at $104.36 by 0043 GMT. Brent crude hit a session high of $111.24 per barrel, its loftiest since Jan. 2, and was last up $1.90 at $110.97. President Barack Obama and the leaders of Britain, Germany and Poland expressed "grave concern" on Sunday over Russia's intrusion into Ukraine, which they called a breach of international law and a threat to international peace and security. The tensions come at a nervous time for markets as activity in China's factory sector slowed to an eight-month low in February, a government survey showed on Saturday, reinforcing signs of a modest slowdown in the world's No. 2 economy as demand weakens. Escalating political tensions in Ukraine pressured Asian stocks on Monday, forcing anxious investors to cut their exposure to riskier assets in favour of traditional safe haven bets such as the Japanese yen and Swiss franc. Source: Reuters