Oil prices rose in Asian trade on prospects for stronger US economic growth and jitters sparked by sabre-rattling over crude producer Iran's nuclear programme.
New York's main contract, light sweet crude for delivery in April, gained 50 cents to $107.20 and Brent North Sea crude for April was up 32 cents to $123.97.
The US is the world's biggest oil consumer and a stronger US economy will mean greater demand.
Meanwhile, the diplomatic row between major Western powers and Iran remains a key influence on investors' decisions, analysts said. US President Barack Obama on Sunday criticised "loose talk of war", and pleaded for patience in ending the nuclear stand-off with Iran, arguing that sustained international pressure would force Tehran to the negotiating table.
His comments came amid reports that Israel is eager to move more quickly and decisively against Iran's nuclear activities, using a military strike to prevent it even reaching a point where it can decide to produce atomic weapons.
Western powers have already imposed a raft of economic sanctions on Tehran in a bid to halt its controversial nuclear programme, which is believed to mask a drive to build weapons.
Tehran denies the charge, and has warned that it could close the Strait of Hormuz - a key transit route for global oil supplies - if increased Western sanctions halt Iranian oil exports. The Islamic republic is the world's fifth largest oil exporter and the second biggest producer in the OPEC cartel.
