Oil prices diverged on Thursday as traders reacted to Middle East supply concerns as Israeli warplanes pounded Gaza and also digested a batch of US economic data.
Brent North Sea crude for delivery in December jumped $1.14 to $110.75 a barrel in late London deals.
New York's main contract, light sweet crude for December, fell 43 cents to $85.89 a barrel.
"Israel's military strikes against Hamas in Gaza have shifted attention back to the supply risks, causing oil prices to rise," said Commerzbank analyst Eugen Weinberg.
Seven Palestinians and three Israelis were killed in a wave of unrelenting cross-border fighting on Thursday as the Jewish state pressed a vast air offensive on Gaza.
Operation Pillar of Defence, Israel's biggest military campaign against Gaza in nearly four years, began on Wednesday with the targeted killing of top Hamas commander Ahmed Jaabari.
The violence, which erupted as Israel heads towards a January general election, sparked expressions of deep concern from the international community and prompted an emergency meeting of the UN Security Council in New York.
Traders also reacted to data from the United States, which is the world's biggest oil consuming nation.
US weekly jobless claims jumped by 78,000 in one week in the wake of Superstorm Sandy, which both interrupted reporting and forced people out of work in the northeast, Labor Department data showed Thursday.
US consumer prices meanwhile rose for a third straight month in October but at a slower pace than recent months as energy prices eased, separate figures showed.
Elsewhere, the Department of Energy said that US crude inventories had risen by 1.1 million barrels last week.
In China, which is the world's biggest consumer of energy, the country's all-powerful Communist Party on Thursday unveiled a new seven-man leadership council steered by Xi Jinping to take command for the next decade.
After striding out in Beijing's Great Hall of the People as the party's new general-secretary, succeeding President Hu Jintao, Xi vowed to fight official corruption and build a "better life" for the nation's 1.3 billion people.