London: Brent crude was up at around $115 (Dh422) a barrel on Monday, supported by worries about potential disruptions to supply from Iraq where Sunni insurgents took control of strongholds along the border with Syria at the weekend.

Brent was up 25 cents at $115.06 by 0848 GMT. US crude for August delivery gained 21 cents to $107.04. The July contract expired on Friday.

Militants from the Islamic State in Iraq and the Levant (Isil) seized three towns in Iraq’s western Anbar province after taking control of two frontier crossings on the Iraq-Syrian border at the weekend.

Sunni tribes also took control of a border crossing between Iraq and Jordan late on Sunday after Iraq’s army pulled out of the area following a clash with rebels.

Meanwhile, there was a lull in fighting at Iraq’s largest refinery, the 300,000 barrel-per-day Baiji complex, on Sunday, although militants still surround the plant.

“The oil price is making steady progress as the news on the ground is not terribly encouraging. There is not really any incentive to sell these markets at the moment,” said Ole Hansen, senior commodity strategist at Saxo Bank.

Although there has not yet been any impact on Iraq’s oil exports, the market is pricing in the implications of escalating tensions, which threaten Iraq’s medium-term capacity growth targets, analysts at Barclays Capital said in a note.

“So far we haven’t seen any supply disruptions in Iraq.

About 90 per cent of Iraqi crude exports go via the south, and the Sunni insurgents are very unlikely to enter this area,” said Carsten Fritsch, an oil analyst at Commerzbank in Frankfurt.

He also pointed to a new pipeline opened by the Kurds, which enables them to export oil via Turkey to the Mediterranean.

On Monday, Turkish Energy Minister Taner Yildiz said a third tanker carrying oil from Iraqi Kurdistan had departed Turkey’s Mediterranean port of Ceyhan and a fourth tanker was being loaded.

This week the market is likely to focus on the response from the US to the situation in Iraq, and whether the insurgents will start to meet greater resistance.

US Secretary of State John Kerry landed in Baghdad on Monday to press Prime Minister Nouri Al Maliki to form a more inclusive government and to discuss US actions to assist Iraq.

On the demand side, data from China showed an expansion in the country’s factory sector for the first time in six months, also helping to underpin oil prices.

A preliminary HSBC survey showed that new orders surged in June indicating that the economy is stabilising thanks to Beijing’s measures to shore up growth.

The HSBC/Markit Flash China Manufacturing Purchasing Managers’ Index (PMI) rose to 50.8 in June, the first time since December that the PMI has been in growth territory.