Oil prices hit two-month highs this week, driven by Federal Reserve stimulus hopes and Middle East unrest.

Other commodities enjoyed mixed fortunes as traders tracked the latest twists and turns in the eurozone debt crisis.

Markets were rattled on Friday July 20, 2012 by growing jitters over Spain, whose 10-year government bond yields hit danger levels above 7.0 percent.
 
World oil prices soared to their highest levels since May, before running into profit-taking.

Brent North Sea crude jumped as high as $108.18 per barrel and New York's light sweet crude for August hit $92.94 on Thursday.

"Prices have climbed ... primarily on the back of geopolitical risks," said Commerzbank analyst Carsten Fritsch.

"The conflict in Syria, which has already been underway for 16 months, appears to be escalating," he said.

"The Iran conflict is also coming into increasingly sharp focus, Israel having blamed Iran for the attack on Israeli tourists in Bulgaria."

Oil rallied for most of this week, first on assurances by the US Federal Reserve that they would intervene should the economy falter and then on increasing tensions in Syria and Iran.

In late Thursday trade, crude jumped more than $2.50 as fighting raged in Damascus, while China and Russia vetoed UN Western resolutions on the conflict.

Meanwhile, Israel accused Iran and Lebanese group Hezbollah of carrying out a suicide bomb attack that killed six Israeli tourists in Bulgaria, raising speculation of a retaliatory attack.

By late Friday on London's Intercontinental Exchange, Brent North Sea crude for delivery in September jumped to $105.98 from $102.23 for the August contract a week earlier.

On the New York Mercantile Exchange, West Texas Intermediate (WTI) or light sweet crude for August rallied to $90.91 a barrel from $86.82.