Oil zoomed to an all-time high of $86.13 a barrel, propelled by robust demand from booming commodity markets and fresh geopolitical worries.
US light, sweet crude for November delivery was more than $2.40 higher -- its fifth straight session of gains.
London Brent crude also rose.
"A run at $90 is now seen as reasonable," Citigroup analysts said in a note.
Oil has remained above $80 for most of the past month after soaring from below $70 in mid-August, fuelled by a mixture of supply concerns ahead of winter and record lows for the dollar, which has driven speculators to buy oil as a hedge.
Regulatory data released on Friday showed that speculators on the New York Mercantile Exchange crude oil market increased their net long positions in the week to Oct. 9.
Analysts said mounting evidence the global economy had largely shrugged off the financial market credit crunch and would grow underpinned a bullish oil outlook, especially against a backdrop of disappointing crude supplies, especially from non-OPEC producers.
The Organization of the Petroleum Exporting Countries (OPEC), poised to boost supplies by an extra 500,000 barrels a day from Nov. 1, on Monday raised its forecast for demand for its oil this winter and said it appeared more likely that top consumer the United States would avoid a sharp economic slowdown.