The killing of top Syrian security chiefs on Wednesday, and an attack on Israeli tourists in Bulgaria which Israel accused Iran of carrying out, worsened the crisis in the Middle East, the source of more than a quarter of the world's oil.

Brent crude gained for a seventh straight day, rising 95 cents to $106.11 a barrel by 0843 GMT and hitting $106.49 earlier, the highest since May 30. US oil gained 63 cents to $90.50.

"US crude rising above $90 implies that overall sentiment is turning positive," said Tetsu Emori, a Tokyo-based commodities fund manager at Astmax Investments. "They touched their lows in June and are turning around. Tension between Iran and the West are also substantial factors."

Analysts said geopolitical concerns outweighed the latest US Department of Energy supply report on Wednesday, which showed crude inventories in the world's top consumer fell less than expected last week.

"Overall, we are more concerned about the latest bombings in Syria and Bulgaria than about the DOE statistics," said Olivier Jakob, analyst at Petromatrix, in a report.

Brent has gained 20 percent since falling to an 18-month low in late June. It had slumped since the year's high of more than $128 in March, weighed by concern demand would slow due to Europe's debt crisis and weaker growth in other regions.

Oil and other riskier assets such as equities have been drawing support from investor optimism the worst may be over for the global economy. European shares hit an 11-week high on Thursday, supported by upbeat earnings from companies such as Electrolux.

A decline in the dollar was also supporting oil. The dollar index slipped almost 0.1 percent on Thursday. The US currency has been under pressure on expectations the Fed would opt for a third round of bond purchases, or quantitative easing, to support the economy.

A weakness in the currency tends to support dollar-denominated commodities such as oil.