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Brent oil price reaches five-month peak

Oil prices rose on Friday, with Brent scaling a five-month peak on geopolitical concerns after crude producer Iran rejected a US offer on nuclear talks, and on healthy data from top energy consumer China.

In earlier Asian deals, Brent North Sea crude for March delivery hit $117.94 a barrel -- the highest level since September 14.

In later trading in London, the contract stood at $117.81, up 57 cents from Thursday's close.

New York's main contract, light sweet crude for March meanwhile gained 23 cents to $96.06 a barrel.

"Brent is trading a little stronger on developments in Iran," said Jason Hughes, head of premium client management at IG Markets Singapore.

Iran's supreme leader Ayatollah Ali Khamenei rejected on Thursday a US offer to negotiate one-on-one on Tehran's nuclear ambitions, ruling out such contacts so long as Washington keeps up its threats against the Islamic republic.

"You (Americans) are pointing the gun at Iran and say either negotiate or we will shoot," Khameni told air force commanders in remarks published on his website.

"Iran will not accept to negotiate with he who threatens us with pressure," in reference to a series of sanctions adopted by Washington to coerce Iran into curbing its nuclear programme," he added.

The growing hostility between the US and Iran strengthened Brent as the international oil benchmark by raising fears that oil supplies could be affected.

Western powers believe Iran is trying to build an atomic weapon, but Tehran says its nuclear research is for peaceful purposes.

Oil investors also took their cue from robust trade figures from China, the world's second biggest economy and largest energy consumer. A strong Chinese economy pushes up oil demand and prices.

Official data released on Friday showed China's trade surplus rose 7.7 percent year-on-year to $29.2 billion in January as the country maintained its economic recovery on improving demand.

Exports jumped a 25.0 percent to $187.4 billion last month, while imports soared 28.8 percent to $158.2 billion, the General Administration of Customs said in a statement.

Crude futures traded mixed on Thursday, but New York crude slid after an extended US refinery outage revived concerns about a glut of crude sitting in the middle of the country.

Brent had risen, increasing the price gap between the world's two benchmark crudes.

WTI has been trading at a deep discount to Brent because of an excess of crude at the landlocked Cushing, Oklahoma, trading hub.

That overhang was expected to be worked off with the expansion of the Seaway pipeline, which would increase the amount of oil that could move from Cushing to Gulf Coast refineries.

But the Seaway pipeline has encountered operational problems, reducing the capacity of the line.

In addition, operations at BP's large Whiting, Indiana-based refinery has been curtailed due to maintenance. On Thursday, reports surfaced that the Whiting outage would be longer than expected.