Brent crude futures approached the level of $89 per barrel (Getty)

Brent crude prices approached the level of $89 per barrel for the first time since last October, as oil supplies faced new threats with the renewed Ukrainian attacks on Russian energy facilities and the escalation of the conflict in the oil-rich Middle East as a result of the ongoing Israeli aggression against the Gaza Strip.

Production restrictions imposed by the Organization of the Petroleum Exporting Countries (OPEC) and its allies, coupled with strong expectations for consumption this year, have helped push prices higher.

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Crude prices

Brent crude futures for the nearest delivery rose $1.41, or 1.62%, to $88.84 per barrel, at the time of writing the report, and US West Texas Intermediate crude futures increased $1.52, or 1.83%, to $85.25 per barrel.

Ukraine bombed one of Russia's largest refineries on Tuesday, in a drone attack 1,300 kilometers from the front lines in Ukraine, which Russia initially said it repelled.

A Reuters analysis of images showing the impact of the attack indicates that it hit the refinery's main oil refining unit, which represents about half of the refinery's total annual production capacity of 340,000 barrels per day.

In the Middle East, Iranian President Ibrahim Raisi said that his country would retaliate in response to an air attack suspected of being launched by Israel on the Iranian consulate in the Syrian capital, Damascus.

Oil continues to rise and is approaching $90 per barrel (Shutterstock)

In a related context, the Iranian Labor News Agency quoted the head of the Customs Authority, Mohammad Rezvanifar, as saying on Tuesday that Iran’s oil exports amounted to $35.8 billion in the past 12 months until March 2024.

Although the United States re-imposed sanctions on Tehran in 2018, Chinese purchases of Iranian oil have allowed the country to maintain a trade surplus.

OPEC Plus

The markets are also awaiting the meeting of the OPEC Plus alliance, which includes the 13 members of OPEC along with 10 other oil-exporting countries, led by Russia, tomorrow, Wednesday, which will review the implementation of the group’s oil production cuts.

The coalition is expected to maintain the current voluntary production cuts of 2.2 million barrels per day until the end of the second quarter of this year, and OPEC production decreased last month by 50 thousand barrels per day, indicating that the voluntary cuts are having some effect.

What also supported oil prices was the expansion of manufacturing activity in China in March for the first time in 6 months, and in the United States for the first time in a year and a half, which the markets considered an indication of high demand for oil. China is the world's largest importer of crude oil while the United States is the largest consumer.

Source: Reuters + Anadolu Agency