NEW YORK - Crude oil prices soared on Tuesday as the dollar declined on rising euro and concerns over supplies in Iran and Kazakhstan continued.

The euro rose on Tuesday after the Spanish short-term borrowing costs fell sharply and German business sentiment surged in December. Another factor that gave support to the euro was the expectation that eurozone banks would borrow three-year loans from European Central Bank later this week in order to ease the credit crunch in the region.

The dollar index, which tracks the greenback's performance against a basket of currencies, dipped about 0.5 percent, lifting the crude.

Meanwhile, worries about supply in Iran and Kazakhstan continued. Countries met in Rome on Tuesday to discuss further sanctions against Iran, paving the way for the coming EU foreign ministers meeting next month. Iran, the world's fifth oil exporter, was facing rising sanction pressure, which posed great risks to oil supply. And in Kazakhstan, oil workers' protests continued.

On the economic front, US house starts came in stronger-than- expected and jumped to a 1-1/2-year high in November, boosting hopes for an improving US house market and increasing investors' risk appetite.

Light, sweet crude for January delivery jumped 3.34 dollars, or 3.44 percent to settle at 97.22 dollars a barrel on the New York Mercantile Exchange. The February contract rose 3.17 dollars to settle at 97.42 dollars a barrel.

In London, Brent crude for February delivery also rose sharply and last traded around 107 dollars a barrel.