By early afternoon in Europe, benchmark oil for April delivery was up 53 cents to $107.59 in electronic trading on the New York Mercantile Exchange. The contract rose $1.95 to settle at $107.06 per barrel in New York on Friday.
In London, Brent crude for May delivery was down 37 cents at $125.44 per barrel on the ICE Futures exchange.
On Friday, the University of Michigan said its consumer sentiment index for last month was below analysts' expectations, driven by worries about gasoline prices, which soared 6 percent in February.
Higher gasoline prices could crimp the U.S. economy by shrinking the amount of money that people have to spend. Gasoline is currently selling for an average of $3.83 per gallon ($1 a liter) in the U.S., 31 cents more than a month ago.
Crude has jumped from $75 in October as signs of an improving U.S. economy — led by growing employment, retail sales and industrial production — bolstered investor confidence.
International Monetary Fund Managing Director Christine Lagarde said Sunday that the global economy had "stepped back from the brink" in recent months and there was reason for more optimism about growth.
Traders were also eyeing a possible release of strategic crude reserves by the U.S. and Britain. Reports came out Thursday that an agreement to release reserves had been reached but U.S. officials quickly denied the stories.
The release of crude would likely be a measure aimed at lowering prices, but traders are also wondering if it would be designed to replace Iranian production in the event of a military strike against that country's nuclear facilities or tighter economic sanctions.
"The reserves headlines unnerved as much of the oil market as it calmed, in particular by creating an impression in some areas that talk of a release might be pre-emptive actions against Iran rather than primarily a response to current prices," Barclays Capital said in a report "Even in the event of a release, the effect on prices will be limited."
Some analysts expect crude prices to fall this year as fears over Iran ease and global economic growth disappoints. Capital Economics forecasts Brent will fall to below $100 by the end of 2012.
"Oil prices could quickly drop by up to $10 if Iran gives some ground on its nuclear program," Capital Economics said in a report. "Faith in the sustainability of the global recovery could soon disappear too, as the economic and financial reality is less impressive."
Analysts at Sucden Financial in London had similar thoughts.
"As the tentative relationship between Iran and the West has been priced into the markets, we expect crude oil prices to start correcting lower due to the weaker oil demand from the U.S. and Asia and the fragile economic conditions across the eurozone," Sucden Financial said in its energy report. "The oil market looks overbought, suggesting potential for correction lower in the short term, with (Nymex) crude oil retesting the $100-105 area."
In other energy trading, heating oil was down 0.81 cents at $3.2738 per gallon and gasoline futures rose 0.25 cent to $3.3594 per gallon. Natural gas slid 1.2 cents to $2.314 per 1,000 cubic feet.
Alex Kennedy in Singapore contributed to this report.