Crude oil prices moved higher on Monday amid concerns about possible supply disruptions due to an escalation in tensions in the Middle East.

Recent data showing a significant drop in U.S. crude inventories and easing worries about the outlook for energy demand after the U.S. and China agreed in principle on a phase one trade deal contributed as well to oil’s rise.

West Texas Intermediate crude oil futures for February ended up $0.22, or about 0.4%, at $63.27 a barrel, the highest closing value for a seven-month contract.

Brent Crude oil futures moved past the $70 mark and hit a high of $70.75 a barrel before paring gains. The contract was last seen traded at $68.78 a barrel, gaining $0.18, or about 0.25%.

On Friday, WTI crude oil futures for February ended up $1.87, or 3.1%, at $63.05 a barrel.

According to reports, the U.S. State Department has warned of a “heightened risk” of missile attacks near military bases and energy facilities in Saudi Arabia.

U.S. President Donald Trump issued a threat to impose sanctions on Iraq and retaliate against Iran if it strikes back after the killing of its top commander.

The threat against Iraq, the second largest producer among the OPEC, comes after its parliament voted in favor of a resolution calling for an end to the foreign military presence in the country, including the estimated 5,200 U.S. troops stationed to help fight Islamic State extremists.

Iran announced Sunday it would no longer abide by the limits contained in the 2015 nuclear deal while reports from Baghdad say the U.S. embassy compound there was targeted in an attack on Sunday evening.

Traders also took note of reports that all the four oil export terminals in eastern Libya were forced to shut on Sunday due to bad weather and that the closure could last three days.

The material has been provided by InstaForex Company – www.instaforex.com