Oil prices rose more than two percent on Monday after fresh tensions hurt hopes for progress in Ukraine peace talks. At the same time, traders grew more concerned about supply risks in the Middle East.
Brent crude climbed one dollar and thirty cents, or just over two percent, to settle at sixty one dollars and ninety-four cents a barrel. US West Texas Intermediate rose one dollar and thirty-four cents, or two point four percent, to close at fifty-eight dollars and eight cents.
Russia Ukraine Tensions Support Prices
Russia accused Ukraine of launching a drone attack on President Vladimir Putin’s residence in northern Russia. Following the claim, Moscow said it would review its stance on peace talks.
Ukraine rejected the accusation. Its foreign minister said Russia was using false claims to justify further strikes.
Meanwhile, oil traders reacted quickly. According to Ritterbusch and Associates, prices could move higher in the days ahead unless Russia changes its demands on territory and security.
Earlier on Monday, Ukrainian President Volodymyr Zelenskiy said talks with US President Donald Trump had made strong progress. He added that the US and Ukrainian teams would meet next week to finalize steps aimed at ending the war.
Yemen Tensions Raise Supply Concerns
At the same time, attention shifted toward the Middle East. Analysts said rising tensions in Yemen added another risk to global oil supply.
Gelber and Associates noted that Saudi air strikes in Yemen kept supply disruption risks in focus. The Saudi-led coalition warned it would respond to any military moves that threatened de escalation efforts.
Fighting in Yemen’s Hadramout province escalated late last week. Two members of the Southern Transitional Council’s Hadhrami Elite Forces were killed. Saudi air strikes followed soon after, according to sources.
China Demand and Market Outlook
Strong crude imports by China are also tightening the market. UBS analyst Giovanni Staunovo said this demand helped support prices.
He added that sixty dollars per barrel now acts as a soft floor for Brent crude. He also expects prices to recover slightly in 2026 as non-OPEC+ supply growth slows.
US Inventory Data in Focus
Investors also awaited US oil inventory data for the week ending December 19th. The report was delayed without a new release time.
A Reuters poll showed analysts expect US crude stockpiles to fall. However, they forecast higher gasoline and distillate inventories.
