Oil prices on both sides of the Atlantic climbed on Monday, as investors shifted their attention from worries about swelling supplies to concerns about ongoing violence in Libya and other global hotspots.

Oil prices fell sharply last week, with the front-month of Brent crude hitting its lowest level since April, and traded lower early on Monday before bouncing back into positive territory.

Brent crude gained 57 cents to settle at $105.41 a barrel, off a session low of $104.52. U.S. crude gained 41 cents to settle at $98.29 a barrel, after touching a session low of $97.43.

The spread <CL-LCO1=R> between the two benchmarks closed at $7.12.

North Sea crude for immediate delivery has been at a discount to futures for the longest period since 2011. This contango market structure indicates a well-supplied market.

"The market is trying to stabilize after we reached a four-month low last week," said Gene McGillian, an analyst at Tradition Energy in Stamford, Connecticut. "We still have those geopolitical hot spots and the market seems to be taking that into account."

Buyers were lured back by fears of growing oil supply disruptions due to escalating violence in Libya and Iraq, both major producers, and the crisis in eastern Ukraine, where Russian-backed separatists are fighting Ukrainian government troops.

In Libya, oil output dropped to around 450,000 barrels per day (bpd) from 500,000 bpd last week, but a spokesman for the state-run National Oil Corp said oilfields were still secure despite clashes between rival factions in the capital, Tripoli.

"Libya is really going down the wrong way. Production has been slowly coming off," said Olivier Jakob of the Petromatrix consultancy in Switzerland. "Libya could quickly return to a much lower production level."

More than 20 people were killed in clashes around Tripoli on Sunday as battles raged for control of the airport, and fighting led to a huge fire at the city's fuel depot.

Commerzbank oil analyst Carsten Fritsch said oil prices could rise significantly if the situation deteriorates further.

Meanwhile, the crisis between Russia and Ukraine intensified, as reports emerged that the Ukrainian army is deploying tactical missile launchers and multiple rocket-launch systems near Donetsk in the east of the country.

"The market was trying to push the geopolitical fears aside with all the supply and with demand not being all that robust, but a headline like, 'Kiev deploying missile launchers,' brings it back into the mix," said Phil Flynn, analyst at Price Futures Group in Chicago.

In Iraq, July oil exports rose to an average of 2.44 million barrels per day (bpd) from 2.42 million bpd in the previous month, despite suspension of shipments from major oilfields around Kirkuk due to fighting in the north.

Kurdish peshmerga forces said they planned a counter-offensive against Islamic State fighters who seized the Ain Zalah oilfield and the country's largest dam on Sunday. 

(By Lorenzo Ligato; Additional reporting by Jack Stubbs in London and Keith Wallis in Singapore; Editing by Jessica Resnick-Ault, David Gregorio, Tom Brown and Paul Simao)