Crude oil jumped above $62 a barrel and gasoline prices surged to a seven-month high in New York after Iran seized 15 British naval personnel, heightening the prospect of conflict involving OPEC's second-biggest producer.
Signs that the United Nations Security Council will impose new sanctions on Iran to suspend its nuclear program also bolstered prices.
"Any time tension rises in the Persian Gulf, you have to be concerned," said Tom Bentz, an oil broker with BNP Paribas in New York. "Worries that Iran would take oil off the market because of the nuclear dispute have been pushing prices higher for a while now. We are in a world that can't afford to have any supply taken off the market."
Crude oil for May delivery rose 59 cents, or 1 percent, to settle at $62.28 a barrel on the New York Mercantile Exchange.
Gasoline for April delivery in New York rose 4.08 cents, or 2.1 percent, to $1.9983 a gallon, the highest close since Aug. 18. The contract touched $2.02 a gallon, the highest intraday price since Aug. 17.
Increased concern about Iran comes as U.S. refiners prepare to increase gasoline output before the summer driving season.
In other trading, natural gas futures fell 5.1 cents to $7.269 per million British thermal units, and heating oil futures slipped less than a penny to $1.7111 a gallon.
Brent crude oil for May settlement rose 67 cents, or 1.1 percent, to $63.18 a barrel on the London-based ICE Futures exchange.
