Oil prices climbed to their highest since 2014 on Tuesday, with U.S. crude rising more than 3 percent and Brent breaking the 88-point level, as investors worried that oil supply could be disrupted after attacks in the Middle East, exacerbating an already tight supply outlook. Supply concerns rose sharply this week after Yemen's Houthis attacked the United Arab Emirates, escalating hostilities between the Iran-aligned Houthis and the Saudi-led coalition; drone and missile strikes that detonated oil After the tanker and three people were killed, the Houthis warned that more facilities could be attacked, while the UAE said it would reserve the right to "respond to these terrorist attacks".

The damage to the UAE's oil facilities in Abu Dhabi is not serious in itself, but it raises the question of supply disruptions in the region in 2022, said Louise Dickson, senior oil market analyst at Rystad Energy. In addition, tensions between Ukraine and OPEC+ member Russia have added to the geopolitical premium for oil prices.

The Organization of the Petroleum Exporting Countries (OPEC) on Tuesday stuck to its forecast for strong growth in global oil demand in 2022, expecting the oil market to remain well supported this year despite the raging Omicron variant and expectations of interest rate hikes by many central banks.

Analysts at Goldman Sachs said they expect oil inventories in OECD countries to fall to their lowest levels since 2000 by the summer, while Brent crude prices will rise to $100 a barrel later this year.