The price of oil approached $105 a barrel Wednesday as concerns grew over the crisis in Ukraine, which took military action against separatists in its east. Gains were temporarily tempered by slower Chinese growth.
By early afternoon in Europe, benchmark U.S. crude for May delivery was up $1.04 at $104.79 a barrel in electronic trading on the New York Mercantile Exchange. On Tuesday, the Nymex contract closed 30 cents lower.
Brent crude, a benchmark for international varieties of crude, was up 76 cents at $110.12 a barrel on the ICE Futures exchange in London.
Ukraine's government sent tanks and troops to reclaim government buildings occupied by pro-Russian gunmen in its eastern region. NATO Secretary General Anders Fogh Rasmussen said the alliance would deploy forces to strengthen its military presence near Ukraine, which borders several NATO members.
Officials from the U.S., Russia, Ukraine and the European Union are set to meet in Geneva on Thursday for negotiations aimed at persuading Russia to back off in Ukraine following its annexation of Crimea.
Failing that, EU leaders could meet as early as next week to decide on tighter sanctions on Russia, a major producer of oil and gas that has blamed with fomenting unrest in eastern Ukraine. Russia is a major energy supplier to Europe.
"The increasing tensions between the West and Russia over Ukraine could provide further upside momentum to the oil market, supporting crude oil prices higher," said Myrto Sokou of Sucden Financial Research in London.
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