The oil futures rose on Friday fueled by supply constraints and concerns about a possible attack by Russia a Ukraine, although an imminent release of crude reserves by China is looming.
crude oil futures Brent rose $1.59, or 1.9%, to a 2-1/2-month high of $85.06 a barrel, while West Texas Intermediate at U.S (WTI) rose $1.7, or 2.07%, to $83.82.
“People looking at the big picture realize that the global supply versus demand situation is very tight and that is giving the market a solid boost,” said Phil Flynn, senior analyst at Price Futures Group.
Flynn added that observers were seeing tensions rising between Russia and Ukraine and ahead of a long weekend in the United States.
US officials expressed fear on Friday that Russia is preparing to attack Ukraine if diplomacy fails. Moscow, which has massed 100,000 troops on the Ukrainian border, released images of its forces on the move.
The dollar was headed for its biggest weekly decline in four months. A weaker dollar makes commodities more affordable for holders of other currencies.
Several banks have forecast the price of oil to hit $100 a barrel this year as demand is expected to outstrip supply, bringing capacity constraints among OPEC+ countries into the spotlight.
However, gains were limited after Reuters reported that China plans to release oil reserves around the Lunar New Year holidays, between January 31 and February 6, as part of a plan coordinated by the United States with other big consumers to cut world prices, sources said.