Global crude oil prices edged higher on Friday as investors reacted to fresh attacks on Saudi energy infrastructure and continued uncertainty over supply routes in the Strait of Hormuz.
The gains came during a two-week ceasefire announced by US President Donald Trump.
Brent crude futures rose by as much as 1.13 per cent to $97.01 per barrel. US West Texas Intermediate (WTI) increased 1.39 per cent to $99.24 in early trading.
Earlier in the week, oil prices had declined to nearly 20 per cent below the $100-per-barrel level on Wednesday. They had averaged that mark since 28 February.
On the domestic front, crude oil futures on the Multi-Commodity Exchange (MCX) for 20 April delivery were trading at Rs 9,222 at around 10 AM. This marked an increase of Rs 289, or 3.23 per cent, during the session.
The recent rise in prices reflects ongoing concerns about the ceasefire's effectiveness.
Israel continued its strikes in Lebanon, while Iran shut the Strait of Hormuz, raising fears about global supply disruptions.
Shipping companies have indicated they need more clarity on ceasefire conditions before resuming transit through the route.
President Trump warned that failure to comply with the ceasefire terms could trigger significantly larger military action. He said such an outcome was unlikely.
The US President noted that Iran would not be allowed to develop nuclear weapons and emphasised that the Strait of Hormuz would remain open. He further added that US forces were prepared to act if necessary.
Shipping activity through the Strait remained heavily affected, operating at less than 10 per cent of normal levels on Thursday.
Looking ahead, the Asian Development Bank (ADB) indicated that oil prices are likely to stay high in the short term. They may gradually stabilise if geopolitical tensions subside.
In Indian markets, benchmark indices Sensex and Nifty were both trading about 1 per cent higher in early deals on Friday.