Oil prices rose more than 2 per cent after reports that Iran was preparing a retaliatory strike on Israel from Iraq in the coming days, though benchmarks were still set for a weekly decline, Reuters reports.

Brent crude futures LCOc1 were up $1.72, or 2.4pc, at $74.53 a barrel by 1024 GMT. US West Texas Intermediate crude CLc1 rose $1.76, or 2.5pc, to $71.02.

US news website Axios reported that Israeli intelligence suggests that Iran is preparing to attack Israel from Iraq within days, citing two unidentified Israeli sources.

“Any additional responses from Iran might remain restrained, similar to Israel’s limited strike last weekend, hence primarily intended as a demonstration of strength rather than an invitation to open warfare,” said SEB Research analyst Ole Hvalbye.