NEW YORK: Oil prices jumped more than $2 to their highest in a month on growing hope for a deal to extend funding of the US government and concerns over supplies from Libya and the Middle East.

Brent crude oil gained steadily across the session, rising by $2.66 to $111.72 as of 1711 GMT. US crude was up $1.81 at $103.42.

Both contracts headed toward their biggest gains in three weeks.

US House of Representatives Republicans plan to offer President Barack Obama a short-term increase in the federal debt limit if he will agree to negotiate with Republicans on matters including funding to reopen the government, which has remained in partial shutdown since last week.

US stock markets climbed by nearly 2 percent on hopes of ending the US government budget stalemate, adding support to the oil market

Oil traders were also on alert for signs of further disruption in supplies from the Middle East and Africa.

Libya’s oil output has recently recovered to 700,000 barrels per day, after falling at mid-year to its lowest since the country’s 2011 civil war after a combination of strikes, militias and political activists blocked the majority of Libya’s oil fields and ports in late July.

The spread between global benchmark Brent and US oil had widened earlier in the session as the price of Brent, which is more sensitive to geopolitical events, rose, said Gene McGillian, analyst with Tradition Energy in Stamford, Connecticut.

“You’re not going to have any problems with oil supply in the US,” he said.

“We are going to continue to pump by multi-decade highs.”

The spread had widened to as much as $8.95 per barrel and was last trading at $8.32.