Oil rose to around $102 a barrel today, underpinned by Hurricane Ike which could threaten oil refineries in the United States, the world's biggest energy consumer.
US crude for October delivery rose $1.27 to $102.14 a barrel by 11.58am, having settled $1.71 lower yesterday, when prices dipped as low as $100.10, their lowest since early April.
London Brent gained $1.17 to $98.81 a barrel, after a fall to around a six-month low of $96.99 yesterday.
"We are on hurricane watch, as Ike takes aim at the US refining sector this weekend," said Edward Meir of broker MF Global.
"We expect Friday's session to end on a positive note. However, the markets could open sharply lower on Monday if Ike - similar to (Hurricane) Gustav before it - ends up being a 'bust'."
The US coastal areas under threat from Ike are lined with oil refineries that process about 25 percent of the nation's fuel. Ike is likely to come ashore late today or early tomorrow as a Category 3 storm with winds of more than 178kph, according to the National Hurricane Center.
Oil has fallen about 30 per cent from a record peak of $147.27 a barrel on July 11th.
The prospect of lower demand for fuel from the United States and Europe, due to faltering economic growth, has contributed to the slide. A rebound in the US dollar has also put pressure on some U.S. dollar-denominated commodities.
US crude oil prices came close to breaching the $100 mark yesterday, despite the threat from Hurricane Ike.
A report that Saudi Arabia had no plans to cut output, despite OPEC's agreement in Vienna this week to trim supply, also undermined prices.
Saudi Arabia, the world's largest oil producer, has no intention to reduce production at present unless customer demand falls, Saudi-owned daily Al Hayat reported on Thursday.