A weaker dollar, projected higher demand and geopolitical uncertainty caused oil to jump on Tuesday.

The prices of oil have jumped on Tuesday as a result of a weaker U.S. dollar lifting commodities denominated in the currency and as the Organization of Petroleum Exporting Countries has slightly risen its predictions for world oil demand growth. The violence that is currently happening in Yemen has also played a part in boosting oil prices, as the conflict caused many destabilizations including the uncertainty of the security of all crude supplies located in the Middle East. The fall of the dollar on the bond market has made oil and many other commodities priced in the currency easier to afford by holders of the Euro and other currencies.

The Organization of Petroleum Exporting Countries released its world oil demand growth estimate for 2015, expecting around 1.18 million barrels per day which is higher than the previous estimate which expected around 1.17 million barrels per day. The air strikes led by Saudi Arabia which were aiming for the Houthis, who are allied with Iran, have hit a rocket base in Sanaa, the capital of Yemen, wounding three hundred people and killing ninety ahead of a five day ceasefire which is agreed to start on late Tuesday. Even though Yemen is a small player when it comes to oil production, the country has a key role in oil distribution as it has many ports which are key factors in shipping and the conflict has raised concerns over the supply routes. The United States crude futures were up by $1.40 to $60.65 per barrel because of the recent events. Oil had the biggest monthly advance in April during the last six years, rising by almost 25% due to signs that indicate the end of the global glut. The whole market was compromised by uncertainty of fears that the higher prices would cause more production. “The market is really torn between wanting to be on the bullish side when you have a weaker dollar and geopolitical situations like today, and staying in accordance with fundamentals, when there’s already a deluge of West African crude barrels out there without buyers,” said the president of Houston-based Lipow Oil Associates, Andrew Lipow.

Saudi Arabia has managed to pump 10.308 million barrels per day in April, which is up on March when they pumped 10.29 million barrels per day. Goldman Sachs has stated that the recent oil rally was premature and that the crude prices were “expensive relative to current and forecast fundamentals”.