Oil prices rise on Iraq fears

Oil prices gained Thursday as the market worried that escalating conflicts in Iraq could disrupt supplies from the second largest crude producer in OPEC.

Militants of the Islamic State in Iraq are pressing on to the capital city Baghdad after seizing several major cities in northern Iraq in recent days.

Iraq is the second biggest oil exporter in OPEC after Saudi Arabia, exporting about 2.5 million barrels a day, according to the Energy Information Administration. Reports said some Western oil companies has evacuated workers from Iraqi oil fields due to the unrest.

U.S. President Barack Obama announced Thursday that the United States will send 300 military advisers to Iraq as violence escalates in the Middle East country.

Crude prices were also supported by the loose monetary policy of the United States.

The Fed announced Wednesday that it will continue to taper its monthly bond purchases by another 10 billion U.S. dollars next month and lowered its U.S. growth forecast for this year, while reiterating that it is appropriate to keep its benchmark short- term interest rates near zero "for a considerable time" after the bond purchase program ends.

Light, sweet crude for July delivery moved up 46 cents to settle at 106.43 U.S. dollars a barrel on the New York Mercantile Exchange, while Brent crude for August delivery gained 80 cents to close at 115.06 dollars a barrel.