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Oil prices extended gains for a fourth consecutive session on Thursday as fresh US strikes on Iranian military targets heightened concerns over a wider regional conflict and potential disruptions to oil shipments through the Strait of Hormuz.
By 0026 GMT, Brent crude futures had risen 33 cents, or 0.4%, to $85.28 a barrel, while US West Texas Intermediate crude gained 42 cents, or 0.5%, to $80.02 a barrel.
Both benchmarks gained about 0.3% on Wednesday and were hovering near their one-month highs touched on Tuesday.
The United States struck Iran's coastal defences and missile sites on Wednesday after reimposing a naval blockade of its ports, while Iran threatened to shut off more regional energy exports, saying it was engaged in an "existential war" with America.
"With tensions in the Middle East flaring up again, buying is taking the lead," said Hiroyuki Kikukawa, chief strategist of Nissan Securities Investment.
"While mediation efforts by neighbouring countries continue and the consensus view is that a full-scale war is unlikely, WTI could still rise to $85-$87 depending on how the conflict develops," he said.
Oil prices have gained this week as attacks deepened supply disruption in the Strait of Hormuz, which handled about a fifth of the world's oil and liquefied natural gas trade before the war began.
Hostilities between Iran and the US reignited last week, fraying an already fragile truce reached in June after several months of fighting.
Goldman Sachs said Brent could exceed $110 in the fourth quarter if the Gulf export recovery continues to stall, but could fall into the $60s by year-end if tensions ease and production recovers faster than expected.
Meanwhile, the US Energy Information Administration said crude inventories fell by 1.7 million barrels in the week to July 10, compared with analysts' expectations for a 2.6 million-barrel draw.
