Brent crude breaks above $89 for first time since October on fresh supply threats

U.S. West Texas Intermediate (WTI) crude futures for May rose $1.23, or about 1.5%, to $84.94.

A Ukrainian drone struck one of Russia's biggest refineries on Tuesday in an attack that Russia initially said it repelled.

A Reuters analysis of images showing the impact of the attack suggest it hit the refinery's primary oil refining unit, which accounts for about half of the plant's total annual production capacity of 340,000 barrels per day (bpd).

Russia, among the top three global oil producers and one of the largest exporters of oil products, has been contending with a spate of ukrainian attacks on its oil refineries and has mounted its own attacks on Ukrainian energy infrastructure.

In the Middle East, Iran has vowed to take revenge on Israel for an airstrike that killed two of its top generals and five other military advisers at the Iranian embassy compound in Damascus.

Israel has been at war against Iran-backed Palestinian group Hamas in Gaza, but direct Iranian involvement could spark a "region-wide conflict with plausible impact on oil supply", said Tamas Varga at oil broker PVM.

Elsewhere, an ecological organisation on Tuesday said that a European satellite had spotted an oil spill in the northern Caspian Sea near Kazakhstan's giant Kashagan oilfield.

Markets are also looking ahead to Wednesday's ministerial panel meeting of the Organization of the Petroleum Exporting Countries (OPEC) and its allies, together known as OPEC+. The panel is unlikely to recommend any change in oil output policy, OPEC+ sources told Reuters.

The demand outlook perked up, meanwhile, as March data showed an expansion in Chinese manufacturing activity for the first time in six months and in the U.S. for the first time in a year and a half.