Oil prices rose drastically today with growing tension in Ukraine threatening to disrupt supplies in Europe.
Brent crude rose by $1.48 to $110.55 a barrel, while US oil was up by $2.06 to $104.65, reported Reuters.
Crude prices went up as soon as Russian President Vladimir Putin secured permission from his parliament to use military force to protect Russian citizens in Ukraine.
Putin also informed the US President Barack Obama that he has the right to defend Russian interests and nationals in the neighbouring country.
The markets were under pressure due to escalating geo-political tension in Ukraine, forcing anxious investors to cut their exposure to riskier assets in favour of traditional safe bets.
The tension between Ukraine and Russia has added to the worry caused when activity in China’s factory sector slowed to an eight-month low in February.
China’s official Purchasing Managers’ Index (PMI) edged down to 50.2 in February from January’s 50.5, just ahead of market expectations of 50.1.
HSBC and Markit Economics’ preliminary survey released last week revealed that the factory sector activity hit a seven-month low of 48.3 from 49.5 in January.
In recent weeks, investors have been concerned that the Chinese and the US factory sectors are dragging on global activity, even as European manufacturers enjoyed a solid start to the year.
Image: Tension between Ukraine and Russia causes worries over oil supply disruptions. Photo: courtesy of Victor Habbick.