Oil jumped nearly 2 percent on Monday on optimism about the pace of global economic recovery and as cold weather across the United States boosted fuel demand.
Stunning records for cold were set across the nation, increasing the demand for heating fuels over the weekend, said Phil Flynn, analyst for PFGBest Research in Chicago.
The National Weather Service said total U.S. heating demand will be higher than normal this week as the first seasonal wave of cold weather hits the Northeast and Midwest.
U.S. crude rose $1.39 to $73.16 a barrel by 2:34 p.m. EDT, after earlier touching $73.84, the highest since August 25. Brent crude traded up $1.26 to $71.26 a barrel.
Further support came from a fall in the U.S. dollar as investors positioned ahead of U.S. corporate earnings later this week on expectations strong results will drive risk tolerance higher.
Traders have been looking for signs of an economic turnaround that could support fuel demand, which has been hard hit by the recession.
Some of the biggest U.S. corporate names are scheduled to post earnings this week, a reality check for whether a seven-month rally in stocks this year has further to run.
Global equity markets moved up, with Wall Street looking set for gains as investors bet on a positive corporate earnings season in both the United States and Europe.
Saudi Arabia, the world's top oil exporter, will keep steady in November its curbs on the contracted volumes of crude it supplies to Asia and Europe.
U.S. weekly oil inventory data from the American Petroleum Institute will be delayed until Wednesday due to the Columbus Day holiday, while the Energy Information Administration report will be released on Thursday.
(Reporting by Matthew Robinson, Robert Gibbons and Gene Ramos in New York; Alex Lawler in London; Fayen Wong in Perth; editing by Jim Marshall)