By Erwin Seba

HOUSTON (Reuters) -The Brent and U.S. West Texas Intermediate benchmarks rose more than $1 a barrel during trade on Friday as markets watched for signs of any direct conflict between Israel and Iran that could further tighten supplies.

settled at $91.17 a barrel, up 52 cents, or 0.57%. U.S. West Texas Intermediate crude finished at $86.91 a barrel, up 32 cents, or 0.37%.

Both benchmarks settled on Thursday at their highest levels since October.

Brent and WTI are set to notch more than 4% gains this week after Iran, the third-largest OPEC producer, vowed revenge against Israel for an attack that killed high-ranking Iranian military personnel.

“If Iran directly attacks Israel, that’s never happened before,” said Phil Flynn, an analyst at Price Futures Group. “It’s just another geopolitical risk domino about to fall.”

Israel has not claimed responsibility for the attack on Iran’s embassy compound in Syria on Monday.

Ongoing Ukrainian drone attacks on refineries in Russia may have disrupted more than 15% of Russian capacity, a NATO official said on Thursday, hitting the country’s fuel output.

The Organization of the Petroleum Exporting Countries (OPEC) and allies led by Russia, known as OPEC+, this week kept its oil supply policy unchanged and pressed some countries to increase compliance with output cuts.

“Further clampdowns on adherence to quotas should see output fall further in Q2,” ANZ analysts Daniel Hynes and Soni Kumari wrote in a note.

“The prospect of a tighter market should see a drawdown in inventories during the second quarter.”

Meanwhile, U.S. job growth soared in March, easily beating expectations, according to official data released on Friday which also showed a steady increase in wages.

The gain of 303,000 jobs last month points to likely robust oil demand but potentially delays anticipated interest rate cuts by the U.S. Federal Reserve later this year.

Global oil demand is expected to grow by 1.4 million barrels per day (bpd) in the first quarter, JPMorgan analysts wrote in a note.

U.S. energy firms this week cut the number of oil and rigs operating for a third week in a row for the first time since October, energy services firm Baker Hughes said in its closely followed report on Friday.

The oil and gas rig count, an early indicator of future output, fell by one to 620 in the week to April 5, the lowest since early February.