US oil prices Thursday rallied from a six-month low following reports that the Obama administration is considering air strikes in Iraq.
US benchmark West Texas Intermediate for September delivery advanced 42 cents to $97.34 a barrel on the New York Mercantile Exchange.
European benchmark Brent oil for September delivery rose 89 cents to $105.44 a barrel in London.
The gains followed reports that President Barack Obama was weighing military strikes against Sunni extremists in Iraq after they attacked a city of predominantly Iraqi Yazidis,  members of an ancient pre-Muslim religious minority.
White House spokesman Josh Earnest would not confirm the reports that US air strikes are on the table, but said American personnel were studying conditions on the ground in cooperation with Iraqi security forces.
The headlines on Iraq "refocused the market's attention on some of the geopolitical hotspots that previously had been the driver" of oil prices, said Gene McGillian, broker and analyst at Tradition Energy.
"We still don't have any resolution to any of the hotspots in the world."
McGillian said US oil prices have shed more than $10 since June 13, adding, "we're approaching a bottom."
Analysts say oil-market fundamentals are still weak in the US as traders look ahead to lower gasoline use after the summer-driving season ends.
But that lackluster demand picture is offset by concerns about political problems that could affect production in Iraq, Libya and Russia.