Oil prices jumped on Tuesday on supply worries after Russia’s decision to recognize the Donetsk and Luhansk regions as independent states.

International benchmark Brent crude was trading at $94.88 per barrel at 0649 GMT with a 2.03% gain after closing the previous session at $92.99 a barrel.

American benchmark West Texas Intermediate (WTI) traded at $93.44 per barrel at the same time for a 3.58% increase after ending the previous session at $90.21 a barrel.

Prices increased more than $2 a barrel after Russian President Vladimir Putin announced the recognition of the Donetsk and Luhansk regions as independent states in a speech on Monday.

The EU agreed to update the already-existing sanctions lists, including applying asset freezes and travel bans on 193 people.

The block also prohibited financial services to a further 48 entities over the illegal annexation of Crimea and the city of Sevastopol. The EU has been applying restrictive measures in response to the Ukrainian crisis since 2014.

US President Joe Biden also signed an executive order barring new investment, trade and financing to, from, or in Ukraine's breakaway Donetsk and Luhansk regions.

Many analysts view these developments as a catalyst for increasing oil and gas prices.

“We were going to $100 without these tensions, seeing how the world is consuming oil faster than it is producing it, so $100 I think is on the cards possibly even today, once the US get in and react to evolving news headlines,” said Matt Stanley, director of the commodity brokerage firm, Star Fuels.

Stanley said “the world needs more oil and gas, and it needs Russian oil and gas.”

“In a market that is already facing supply deficits, if there is a threat that some more production could be taken out? $100 oil may be something we could refer to as cheap,” he added./aa