Oil prices pushed above $31 yesterday ahead of this week's meeting of the OPEC producer cartel which is expected to tighten crude supplies as fuel demand dips to the lowest point in the year.
US light crude in New York rose 53 cents to $31.08 (€28.55) a barrel, its highest price in nearly three weeks.
Trade in Brent crude on London's International Petroleum Exchange was closed for the Easter holiday.
The Organisation of the Petroleum Exporting Countries will meet in Vienna on Thursday for an emergency meeting called after oil dropped about 30 percent in a month as Middle East oil flows escaped severe disruption from war in Iraq.
The prospect of a return of Iraqi crude exports is also expected to put prices under downward pressure.
Oil prices rebounded late last week as Iran called on OPEC, which controls over half of oil exports worldwide, to cut official production quotas, warning that the failure to rein in supply could trigger a price collapse.
Other OPEC members have said tighter compliance to official output limits would probably be enough to avoid a supply glut.
OPEC pumped more than 1.5 million barrels per day (bpd) over its self-imposed 24.5 million bpd production ceiling in March as it raised output to counter the loss of Iraqi exports and earlier disruption from a strike in Venezuela.
Iran's Oil Minister Mr Bijan Zanganeh said yesterday that OPEC's quota busters should be the first to restrain output. "All those that have increased their output in an unusual way, they should also be the first to decrease their production," an Iranian newspaper quoted Mr Zanganeh as saying.
Oil prices have risen back above $30 - the level that some economists warn can hurt economic growth - on the month-long absence of Iraq's crude exports, halted since the start of the US-led offensive.
US inventories of crude and refined products are still below normal levels heading toward the US summer vacation driving season when gasoline demand peaks.
"With market attention firmly focused on the forthcoming OPEC meeting, we expect oil prices will remain well supported given recent statements from member countries indicating a desire to curtail physical supply," said Mr Matthew Warburton of UBS Warburg bank in a research note.
The question of Iraq's representation at the OPEC meeting was muddled yesterday, with Mr Jawdat al-Obeidi, a former Iraqi general who says he is deputy governor of post-war Baghdad saying he would lead a delegation to the OPEC meeting.
The US government said it does not recognise Mr Mohammed Mohsen al-Zubaidi, who has declared himself governor of Baghdad, and therefore his deputy cannot represent Iraq at the OPEC meeting.
Top OPEC officials said on Monday they had not yet received a request from Iraq to send a delegation.
OPEC Secretary-General Mr Alvaro Silva said: "Were faced with a very irregular situation in Iraq and these matters will have to be decided by the ministers."
In a sign Iraq's oil sector is beginning its post-war recovery, Iraqi oil officials said yesterday the country's key oil refinery Daura in Baghdad had started operation at half capacity of 40,000 bpd. - (Reuters)
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