Crude oil futures reversed earlier losses and closed higher after news that the U.S. military intercepted and seized a sanctioned tanker near Venezuela's coast, marking a significant escalation in tensions between the two nations.

WTI crude prices turned positive, settling above $58 per barrel after falling as much as 1% earlier. Brent crude closed above $62 per barrel.

The seizure could further complicate Venezuela's ability to export crude overseas, as other shipping companies may now be more reluctant to load its oil.

U.S. President Donald Trump has repeatedly hinted at potential military action against Venezuela, stating that President Maduro's "days are numbered."

In related developments, Ukraine attacked another Russian "shadow fleet" tanker, continuing its campaign against Moscow's critical maritime oil trade.

Data from the U.S. Energy Information Administration showed a 1.8 million-barrel decline in crude inventories last week, marking the first draw in about three weeks.

January WTI crude rose 0.36% to settle at $58.46 per barrel, while February Brent crude gained 0.44% to $62.21.