Oil prices rose more than $3 today amid escalating tensions between Israel and Iran and supply disruptions in Nigeria triggered by militant attacks on a major offshore field.
The gains marked a reversal from heavy losses Thursday that had been triggered by news China was raising domestic fuel prices - a move that could slow demand growth in the world's second largest energy consumer - and expectations Saudi Arabia was planning a 6% output hike.
US crude for July delivery rose $3.12 to $135.05 a barrel by 4.45pm, off highs of $136.80. London Brent was up $3.06 at $135.06.
Energy experts are concerned any conflict in Iran could lead to a shutdown of the Strait of Hormuz, a waterway separating Iran from the Arabian Peninsula, through which roughly 40% of the world's traded oil is shipped.
Adding to oil's gains, Royal Dutch Shell shut 220,000 barrels of daily production in Nigeria after militants in speedboats attacked the Bonga offshore oil facility.
Shell said it was too soon to say how long output at the deepwater installation would be shut. Nigeria, another OPEC member, is already producing about 20% below potential due to sabotage by militants in the Niger Delta oil hub.
