By Gina Lee

Investing.com – Oil was up on Monday morning in Asia, as the conflict in Ukraine escalates. In response to Ukraine’s invasion, Vladimir Putin of Russia put his nuclear deterrent in high alert.

The price rose to $98.63 at 10:00 PM ET (3.46 AM GMT) after it had climbed above $100 earlier in the session. After reaching a peak of $99.10 earlier in the session and crossing the $100.54 mark last week, the April Brent contract ends on February 28. The price rose 5.11% at $96.27.

“Movements made by Europe and America to expel certain Russian banks SWIFT systems have raised concern about a disruption of supply in the short term,” Daniel Hynes (ANZ commodity strategist) told Reuters.

He said, “The supply risk is the highest we have seen in some time”

Putin placed Russia’s nuclear-weapons-wielding “deterrence force” on high alert Sunday, as Western countries blocked large Russian banks using the SWIFT global messaging system. Russia, the biggest oil producer in the world is now under increased threat.

“President Putin’s decision to put Russian nuclear forces on high alert is a clear and worrying escalation that can only be supportive for oil prices,” PVM’s Stephen Brennock told Reuters.

Investors are also eagerly awaiting the Organization of the Petroleum Exporting Countries’ (OPEC) next meeting and its allies (OPEC+), which is scheduled for March. 2. Expect the cartel to keep its April 2022 plans of adding 400,000 barrels per daily (bpd).

OPEC+ also reportedly reduced its projection for oil market surplus in 2022 by around 200,000 bpd, to 1.1million bpd before the meeting.

Reuters reviewed a report by Reuters’ technical committee on Sunday, which showed that stocks worldwide fell to 62 Million barrels lower than the average for 2015-2019 by 2022. This further highlights market tightness.

An additional report revealed that OPEC+’s January 2022 targets were 972,000 bpd lower than they actually achieved.

Hynes of ANZ stated that the market is so tight, with OPEC producers struggling to increase output. This means any issues with Russian supply would have a significant impact on all markets.”