Brent crude has been at its highest price in nine months — above $124 a barrel.
US light crude also hit a nine-month high this week.
The reasons, tension between Iran and the West over Tehran’s nuclear programme. UN inspectors sent to visit Iran’s nuclear installations declared their mission a failure, a setback likely to increase the risk of confrontation with the West.
The US dollar is also weak and oil is priced in dollars.
Since the start of the year Brent is up more than 10 percent because of Iran and tighter supplies from production glitches in the North Sea, South Sudan, Syria and Yemen.
“It is the Iran conflict that is causing prices to skyrocket,” Commerzbank oil analysts wrote in a note.
“For as long as the oil price continues to rise, Iran is likely to compensate for its reduced sales volume by charging a higher price and cannot be expected to make any concessions in the nuclear dispute in the near future. At the same time, the risks to the global economy are growing, so discussions about releasing strategic oil reserves are likely if prices keep climbing.”