ALSO READOil near 26-month high as Turkey threatens to cut supply from Kurdish area Oil edges up as Saudis discuss extending supply cut Oil edges higher above $52 ahead of US stocks report Oil markets roiled as Harvey hits US petroleum industry Oil prices rise as Opec and Russia cut production to counter US Shale
Oil prices rose on Thursday, spurred by rising tension around northern Iraq following the autonomous Kurdistan region's vote in favour of independence in a referendum.
Brent crude oil was up 60 cents at $58.50 a barrel by 0945 GMT. It hit a more than two-year high of $59.49 on Tuesday after Monday's referendum vote prompted Turkey to threaten to close the region's oil pipeline.
US light crude was 60 cents higher at $52.74 after reaching a five-month intra-day high of $52.86 a barrel.
Iraqi Kurdistan voted overwhelmingly on Monday in favour of independence, prompting Turkish President Tayyip Erdogan to say he could use military force to prevent the formation of an independent Kurdish state and might close the oil "tap".
US crude prices found some strength from a surprise fall in US stocks.
US crude inventories fell 1.8 million barrels last week, the US Energy Department said, versus forecasts for a 3.4 million-barrel build.
US refiners are still returning to full operations after Hurricane Harvey last month, but gasoline stocks surprisingly rose and stocks of distillates fell less than anticipated.
While this week's US data gave a mixed picture, the outlook for global oil demand has strengthened, analysts say.
The International Energy Agency earlier this month raised its 2017 global oil demand growth estimate to 1.6 million bpd from 1.5 million bpd, citing stronger than expected demand growth in the United States and Europe.
Still, US crude production rose to 9.55 million bpd last week, higher than before Harvey hit the Gulf Coast.
With Brent futures commanding their highest premium over US crude in more than two years, US crude has become increasingly competitive in foreign markets and exports hit a record 1.5 million bpd last week.
That complicates efforts by the Organisation of the Petroleum Exporting Countries and other major producers to push oil higher through output curbs, as every rise in price encourages more US production.