The Mercedes driver is aiming for a third straight pole position and will be confident heading into the afternoon's qualifying.
Monaco's razor-thin, sinewy street circuit again proved hard to handle and Ferrari driver Felipe Massa was fortunate to walk away unharmed after a heavy crash.
Lotus driver Romain Grosjean posted the second fastest time before crashing near the end, losing control as he came too fast into turn one, hitting the barriers and bouncing across the track. Earlier, Adrian Sutil lost control of his Force India and zigzagged across the track into the barriers
Three-time defending champion Sebastian Vettel was third quickest for Red Bull ahead of Ferrari's Fernando Alonso.
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