Oil prices posted a weekly gain amid escalating tension between Opec member Iran and the US.
It raises the prospect of conflict between the two countries that could disrupt the supply flow to global markets.
Brent, the benchmark for two thirds of the world's oil, settled 0.14 per cent higher at $71.76 a barrel, while West Texas Intermediate, the gauge that tracks US crude, closed up 0.12 per cent at $66.48 per barrel.
Oil prices closed 2 per cent higher on Thursday to settle at their highest level in six months.
"Oil markets are starting to price in higher risk as Iran remains a major producer and, more importantly, sits at the heart of the Strait of Hormuz, through which roughly 20 per cent of global oil supply transits," said Daniela Hathorn, senior market analyst at Capital.com.
"Even limited disruption or credible threats to shipping lanes could cause an immediate supply shock," pushing prices higher.
The US and Iran are in a tense stand-off in the Middle East, with Washington demanding Tehran quickly reach an agreement on a deal for its nuclear programme.
US President Donald Trump has set a 10-day deadline for Tehran to strike a deal – “otherwise bad things” will happen, he warned on Thursday.
Iran also threated the US that it would respond “decisively and proportionately” to any military aggression, according to a letter sent by its UN mission to Secretary General Antonio Guterres.
The letter warned that “all bases, facilities and assets of the hostile force in the region would constitute legitimate targets” as part of what Tehran described as a defensive response under international law.
This came after Iran also closed parts of the strategic Strait of Hormuz for a few hours due to “security precautions” for shipping safety as Iran's Islamic Revolutionary Guard Corps conducted military drills in the crucial waterway in the Arabian Gulf.
"Without further escalation, WTI may consolidate between $62 and $70 as traders reassess risk. But if diplomatic efforts deteriorate or military movement intensifies, a move towards $75-$80 cannot be ruled out," Ms Hathorn said.
"Conversely, if negotiations stabilise and supply flows remain uninterrupted, the geopolitical premium could fade quickly, sending prices back towards the $60 support zone."
The US Energy Information Administration’s weekly report showed an unexpectedly large nine million barrels draw in total US commercial crude stocks, lending additional support to oil prices.
"Oil has climbed strongly this year as geopolitical risks overshadow earlier expectations of a market surplus," said MUFG research analyst Soojin Kim. Any disruption to supply through the Strait of Hormuz could tighten global oil markets and push prices higher, she added.
