Oil prices rose in Asia toda to extend overnight gains after the United States reported a drop in the nation's crude inventories and the International Monetary Fund predicted prices could again rise.
The standoff with Iran - Opec's second largest exporter - is affecting oil markets and helped pushed prices to a record $78.40 a barrel in July.
In Asian after-hours electronic trade Thursday, the front-month October contract on the New York Mercantile Exchange leapt by as much as 59 cents to $64.56 a barrel before easing slightly to $64.40 a barrel. Oil prices closed 21 cents higher to settle at $63.97 on Wednesday - its first closing price gain all month.
Prices have fallen nearly 20 per cent in the past two months.
The US Gulf coast has been spared a lashing by hurricanes this year compared to 2005, when Hurricanes Katrina and Rita slammed into production facilities, offshore rigs and ports, curtailing output for months.
US crude inventories fell 2.6 million barrels to 327.7 million barrels last week, according to the federal Energy Information Administration Wednesday. That's still 5.6 per cent above year-ago levels.
The IMF has predicted the global economy is likely to grow by 5.1 per cent this year and 4.9 per cent in 2007, but it said any spike in oil prices could slow growth.
AP