After talks between Ukraine and Russia showed little signs of progress, oil prices went up in Asian trade Monday, according to Dow Jones Newswires.
Financial markets are still determining oil prices by assessing the likelihood of a diplomatic solution to the Ukraine conflict, according to CBA.
Physical shortages linked to current sanctions on Russia will eventually play a more dominant role in oil price determination, CBA says.
The market is keeping an eye on the recent wave of COVID 19 outbreaks in China, which has resulted in some of the heaviest virus-related restrictions since early 2020, according to ANZ.
The front-month WTI crude oil futures are 2.1% higher at $106.93 bbl, while Brent rises 1.9% to $110.01 bbl.
Oil prices lost ground last week, but they were edging higher on Monday as there was no easy replacement for Russian barrels in a tight market.