Oil prices jumped to near $101 a barrel Tuesday in Asia amid concerns that rising tensions between Western powers and Iran could lead to crude supply disruptions.
Benchmark crude for February delivery rose $1.71 to $100.54 a barrel at midday Singapore time in electronic trading on the New York Mercantile Exchange. The contract fell 82 cents to settle at $98.83 in New York on Friday.
Global oil markets were closed Monday for the New Year's Day holiday.
In London, Brent crude was up $1.00 at $108.38 a barrel on the ICE Futures exchange.
On Monday, Iran test-fired a surface-to-surface cruise missile, part of 10-day naval maneuvers scheduled to end Tuesday. Iran's navy chief Adm. Habibollah Sayyari said the test showed the key oil passageway Strait of Hormuz is "completely under our control."
Iran has threatened to close the strait as possible retaliation to new U.S. economic sanctions over Iran's nuclear program.
"Renewed rhetoric out of Iran could force another rush of geopolitical risk premium into the market," energy consultant Ritterbusch and Associates said in a report.
Investors will also be closely watching the latest U.S. economic results this week, especially the December jobs report scheduled to be released Friday.
In other Nymex trading, heating oil rose 3.6 cents to $2.95 per gallon and gasoline futures gained 2.9 cents at $2.69 per gallon. Natural gas futures were down 1.3 cents to $2.98 per 1,000 cubic feet.