Oil prices surged on Wednesday after US President Donald Trump ordered a blockade of "sanctioned" oil tankers heading to and leaving Venezuela

Both Brent and WTI contracts jumped more than two percent before paring gains.

"The big news is the oil-price rally after President Donald Trump announced an oil blockade on Venezuela," said Forex.com analyst Fawad Razaqzada.

"The news lifted shares in energy stocks in Europe -- the likes of BP and Shell helping the UK's FTSE 100 to outperform," he added.

Shares in both companies rose more than one percent.

The gains for crude pared some of the 2.7 percent in losses suffered Tuesday after the US president said a deal to end the war in Ukraine was closer than ever.

Such a development could ease sanctions on Russian oil, adding to oversupply concerns already weighing on the market.

But Razaqzada noted there are reports that the Trump administration is preparing further sanctions on Russia's oil sector in the event Russian President Vladimir Putin rejects a Ukraine peace deal.

Stock indices opened higher on Wall Street, but turned lower as the morning wore on.