Oil hits record high $US127
Pastor Dale Morgan
Oil hits record high $US127
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From correspondents in London and New York
May 14, 2008 07:25am
Article from: Agence France-Presse
THE price of crude oil struck a record high $US126.98 ($135)a barrel
today despite expectations of slower demand growth for crude, traders said.
New York crude beat its all-time peak of $US126.40, which was reached
yesterday. Crude settled up $1.57 to $125.80 a barrel in New York, after
striking the earlier record in London.
Oil prices have more than doubled in the past year and rocketed almost
25 per cent since the start of 2008, when they blasted through the
$US100 barrier.
That has pushed up price of petrol at home to $1.50 a litre or more,
with expectation that the cost of petrol could soon hit $2.00 a litre
over the next year.
Some analysts are tipping oil to head to as high as $US200. Goldman
Sachs last week forecast oil could reach $US200 a barrel within the next
two years.
The Paris-based International Energy Agency forecast in a monthly report
that crude oil demand in 2008 would stand at 86.8 million barrels per
day (bpd) -- some 390,000 bpd less than previous estimate given in April.
Along with an inflow of investor funds, analysts have cited a variety of
factors for this year's price spikes, including rising energy demand
from Asian powerhouse economies China and India, and OPEC's refusal to
pump more crude.
Prices were also moving in line with changes in the US dollar but
traders said that connection has weakened in recent weeks.
The US currency fell to a record low against the euro in April but has
regained ground since then. A weaker US currency makes dollar-priced
crude more affordable for holders of stronger currencies.
Analysts say the market is looking overbought as threatened disruptions
to the Middle East supply have failed to materialise and as violent
threats to output in Nigeria are increasingly priced in.