Oil prices climbed further at the start of the week after peace talks between Iran and the United States collapsed.
A barrel (159 litres) of North Sea Brent crude for July delivery rose by just over 4% to $105.76 in early trading on Monday.
The oil price had risen at the end of last week, after falling to $96 on Thursday amid hopes of a diplomatic solution to the Middle East conflict.
However, efforts by Washington and Tehran to defuse tensions have shown little progress.
US President Donald Trump described Iran’s latest response to a US proposal aimed at ending the conflict as “totally unacceptable” and issued fresh threats against Tehran.
Iran rejected the US proposal, with state media portraying it effectively as a demand for Tehran’s surrender.
Israeli Prime Minister Benjamin Netanyahu has vowed to continue the war until key concerns surrounding Iran’s nuclear programme are resolved.