(Bloomberg) -- Oil extended gains as Russian President Vladimir Putin announced he’s recognizing two self-proclaimed separatist republics in eastern Ukraine and plans to send “peacekeeping forces” to the region in a dramatic escalation of the conflict.
West Texas Intermediate rose to near $95 a barrel in early Asian trading, extending gains from Monday when there was no settlement due to a U.S. holiday. There were no details so far on how many troops might go in, or when. Russia has previously accused Ukraine of having a significant deployment of its own soldiers on the line of contact with the separatists in the Donetsk and Luhansk regions.
While Russia will argue that Putin’s recognition of the regions gives a legal basis for the presence of its troops, the move will likely fuel U.S. and European concerns that Moscow is moving to take control of territory internationally recognized as part of Ukraine, and would put his forces closer to direct confrontation with Ukrainian soldiers. A conflict would potentially upend commodity markets as regional flows are disrupted and possibly targeted by Western sanctions.
Read: Oil Market on Edge as Traders Assess Russia’s Fuel Influence
Oil was also boosted Monday after Saudi Aramco (SE:2222) said it sees signs that demand is rising, especially in Asia. Furthermore, several of OPEC+’s biggest producers want the group to continue with its strategy and add another 400,000 barrels a day of crude to the market in April, according to people familiar with the matter. That comes despite calls for OPEC+ to increase output faster amid tight supplies.
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