Brent crude rose above $107 a barrel on Monday as escalating tensions in the Middle East heightened fears of disruptions to global oil supplies.
Brent crude for November delivery climbed 2.8 per cent to $107.54 a barrel, while US benchmark West Texas Intermediate gained 2.3 per cent to $102.34.
Both benchmarks extended last week’s gains after returning above the $100 mark.
The latest rally was driven by growing concerns over the security of key oil export routes in the Middle East.
Saudi Arabia temporarily shut its East-West pipeline following drone attacks, while a merchant vessel was struck in the Strait of Hormuz on Sunday, killing one person and injuring three others, Iranian authorities said.
The Strait of Hormuz is a major route for global oil shipments, making any disruption to shipping through the waterway a major concern for energy markets.
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Iran has introduced new requirements for vessels seeking to transit the strait and is considering charging service fees, further raising uncertainty over the movement of oil shipments.
Meanwhile, Oman postponed talks between Iran and Gulf states on the future of the strategic waterway, adding to concerns over the stability of global energy supplies.
