Brent crude rose to $105.88 a barrel on Monday, up 2.7%, as conflict in the Gulf entered its third week and disruption to oil shipping through the Strait of Hormuz continued to drive prices higher.
The international oil benchmark has gained more than 40% since the war began, with US crude also up nearly 50% over the same period, trading just below $100 a barrel.
Iran's closure of the Strait of Hormuz, a narrow waterway through which roughly a fifth of the world's oil normally passes, has forced producers to cut output after tanker traffic effectively halted. More than 12 million barrels of oil equivalent per day have been taken offline since the closure, according to energy research firm Rystad Energy.
International Energy Agency members have released a record 400 million barrels from emergency reserves, but the move has done little to calm markets.
In the UK, the government looks set to unveil emergency measures to support consumers faced with spiralling energy bills.
Ed Miliband, the energy secretary, left the door open on Sunday to government intervention on fuel duty and household energy bills if the impact of the Gulf crisis worsens, speaking on BBC One's Sunday with Laura Kuenssberg programme.
"We're going to stand by people in this crisis," he said.