Oil prices extended gains after the killing of a Hamas leader in Iran raised the threat of a wider Middle East conflict and concern over its impact on oil, Reuters reports.

Global benchmark Brent crude futures LCOc1 rose 71 cents, or 0.9 per cent, to $81.55 a barrel by 1124 GMT. US West Texas Intermediate crude CLc1 gained 72 cents, also 0.9pc, to $78.63.

The most active contracts on both benchmarks jumped about 4pc in the previous session.

Hamas leader Ismail Haniyeh was killed in the Iranian capital Tehran. With Israel’s killing less than 24 hours earlier of Hezbollah’s most senior military commander in Beirut, concerns rose that the 10-month conflict in Gaza between Israel and Hamas is turning into wider conflict that could disrupt oil supply from the region.

“Oil markets are justifiably worried that the assassination of Haniyeh will bring Iran more directly into the war with Israel. And that could put at risk Iran’s oil supply and related infrastructure,” Commonwealth Bank of Australia analyst Vivek Dhar wrote in a client note.