- Oil prices jumped Wednesday as Vladimir Putin mobilized more troops for Russia's Ukraine invasion.
- He made a thinly veiled threat that Russia is ready to use nuclear weapons to hold onto territory.
Oil prices jumped Wednesday after President Vladimir Putin hinted Russia is ready to use nuclear force to hold onto its territory in Ukraine.
In a televised address, Putin also said Moscow is calling up more troops to join the forces in Ukraine, via a partial mobilization of 300,000 reservists with military experience.
"If the territorial integrity of our country is threatened, to defend Russia and our people, we will use all means we have. This is not a bluff," Putin said in his address to the nation, according a translation by the BBC.
"The territorial integrity of our motherland, our independence and freedom will be secured, I repeat, with all the means we have.
"Those who try to blackmail us with nuclear weapons should know that the prevailing winds can turn in their direction."
Brent crude futures, the global benchmark, rose 2.57% to $92.95 a barrel as of 5:30 a.m. ET. WTI crude, the US benchmark, rose 2.08% to trade at $86.21 a barrel.
Russia's war with Ukraine has roiled global oil markets, as Western allies imposed sanctions and bans on Moscow and its energy exports. Brent crude surged above $120 a barrel in early March not long after Russia began its invasion.
The tightness in markets has helped drive an energy crisis in Europe, forcing countries like Germany and France to seek alternative sources of fuel before the winter months. There are concerns that a drawn-out conflict will put more pressure on supplies of oil and natural gas.
Worries about a hit to demand from a slowdown in China's economy are also weighing on crude oil prices. Beijing has imposed a series of restrictions and lockdowns to curb the spread of COVID-19 that have hampered businesses.
JP Morgan said oil could shoot past $150 a barrel as demand outpaces supply. That's partly because companies haven't invested enough in future production, raising the prospect of a major supply deficit ahead.
Meanwhile, investors are bracing or the Federal Reserve to make another outsized interest-rate hike of 75 basis points at the conclusion of its two-day meeting later Wednesday. Oil prices have been weighed down by concerns the Fed's aggressive monetary policy could trigger a recession, which would hurt demand.