Brent crude oil rose above $111 on Thursday as risk appetite improved on hopes the euro zone debt crisis was slowly being resolved and on signs of steadier global economic growth.
European shares rose for a fourth straight session towards 5-1/2-month highs on signs Greece would agree a crucial bond swap deal with private creditors. Global stocks as measured by the MSCI index were up more than 0.6 percent, their highest since Oct. 31.
U.S. stocks also edged higher after Bank of America and Morgan Stanley reported earnings.
Stock markets have been performing well since the start of the year, bolstered by good economic numbers from the United States and plentiful liquidity given central banks around the world have been pumping in funds.
News the International Monetary Fund was seeking to more than double its war chest by raising $600 billion in new funds was also seen as positive with analysts saying the move would help the IMF tackle the euro zone crisis.
Brent futures for March rose $1.09 to a high of $111.75 before easing back slightly to trade around $111.15 by 1400 GMT. U.S. crude oil futures for February were up 70 cents at $101.29 per barrel.
"Risk aversion is falling, economic growth seems to be recovering in the United States, and Chinese activity is not as bad as feared," said Eugen Weinberg, head of commodities research at Commerzbank in Frankfurt. "Against expectations, liquidity is improving across almost all markets."
A Reuters poll of more than 250 economists across Asia suggested on Thursday that Asian economic growth was slowing in many key economies including China and India, but no sharp downturn was seen and a slump would be avoided.
"The data still suggests that we're losing momentum, but we're not losing momentum in a rapid deterioration that requires immediate action," said Claudio Piron, emerging Asia rates strategist with Bank of America-Merrill Lynch.
That implies energy demand across the big emerging economies will keep rising, soaking up supplies from the Middle East and elsewhere and keeping the oil market relatively tight at a time of worries over tension between Iran and the West.
Algerian Energy and Mines Minister Youcef Yousfi said on Thursday world oil prices were "satisfactory for both producers and consumers".
Brent has risen to a high above $115 this year supported by concerns over Iran's nuclear programme.
Iran has said it is in touch with Western powers to reopen talks soon on its nuclear programme but Washington and Europe deny this and say they are still waiting for Tehran to show it was ready for serious negotiations.