The price of West Texas Intermediate (WTI) crude oil opened on Tuesday with a 1.4% increase, briefly surpassing the $85 mark to reach $85.04 per barrel.

According to most traders, one of the reasons for these increases is the geopolitical conflicts in the Middle East and Eastern Europe.

The Ukrainian Security Service (SBU) and Ukrainian military intelligence (GUR) reportedly conducted a joint operation last night using long-range drones to attack an oil refinery in the Russian republic of Tatarstan, as reported by Ukrainian media on Tuesday.

Meanwhile, Tehran promised a harsh response against Israel for bombing and destroying its consulate in Damascus, where the Iranian ambassador resided. The ambassador escaped unharmed, but the attack resulted in at least eight deaths, including a brigadier general from the Revolutionary Guard.

Strong Chinese manufacturing PMI, along with news of Israeli military forces attacking the Iranian consulate in Syria with a missile, resulting in the deaths of several members of the Iranian Revolutionary Guard, helped drive oil prices higher.

The report that OPEC production fell by 50,000 barrels per day in March “added separate tailwinds of supply and demand to the market.”

Investors are also paying attention to US economic data to gauge when the US Federal Reserve will cut interest rates, which is expected to stimulate consumption and oil demand.

The Organization of the Petroleum Exporting Countries (OPEC) and its allies led by Russia, known as OPEC+, will hold an online meeting of the Joint Ministerial Monitoring Committee (JMMC) on April 3 to review the market and the implementation by members of the production cuts they have already agreed to extend.

Oil prices have surged this year, supported by tighter supply and attacks on Russian energy infrastructure and the war in the Middle East. Brent crude reached $89 per barrel on Tuesday, up from $77 at the end of 2023.