US crude oil prices rose above $60 last week, moving above the key level for the first time since mid-2015 mainly due to speculation over the impact of unrest in Iran.
West Texas Intermediate (WTI), the US oil benchmark on the Nymex Exchange, rose above the $60 a barrel level on 27 December - traditionally a period of very low volumes on commodity exchanges. Low volumes often amplify volatility on securities exchanges.
After nearly three years of sub-$60 prices, crude oil picked up in the later stages of 2017 thanks to the extension of OPEC-led output curbs.
More recently, unrest on the streets of Tehran - capital of Iran, the world's seventh-biggest oil producer and OPEC number-three - has stoked concerns that output from the Middle-East and Arab countries could be hit further.
“Growing unrest in Iran set the table for a bullish start to 2018,” The Schork Report - an influential energy market research firm - said in a note to clients on Tuesday.
Iranians took to the streets for a fourth day on Sunday, protesting government incompetence and corruption and defying warnings of a crackdown by state authorities.
Iran produces about 3.5 million barrels a day of crude oil, and any disruption of this output caused by growing civil unrest would likely drive prices higher as global oil demand has accelerated thanks to expanding economic growth.
Data on Tuesday, gathered from purchasing managers during December, showed manufacturing activity continued to expand during the month.
Meanwhile, US inventories have continued to decline. In the most recent week's data US crude oil stocks fell by a larger-than-expected 4.61 million barrels. This followed an even sharper 6.5 million barrel-decline in the previous week.
By mid-morning in London on Tuesday, Nymex WTI was up 0.2% at $60.50 a barrel. Brent crude was flat, however, at $66.93 a barrel.