I agree with dixie.

When you "assure" him that everything is alright, do you talk in a baby voice? Kind of the same voice that you use when you praise him for being good?
If so that may be the reason why he's not getting any better. It's not the reason it started it though.
What he sees is you praising him. He thinks that you like it when he acts like that.
I know it's hard but you need to ignore or punish that behavior. Only praise him (or use simliar praise tones & actions) when he is behaving the way you want.

Now to figure out what may be causing it & how to help him overcome is fear better. Thats where we need more info.

Good luck!