Oil vaults to $103 a barrel as dollar dips further

29 February 2008

Mumbai: Crude oil prices rose above $103 a barrel for the first time, aided by a weak dollar and the prospect of excess liquidity driven by lower US interest rates.

Light, sweet crude for April delivery jumped to a record $103.05 a barrel in Asian electronic trading on the New York Mercantile Exchange before edging back to $102.79 a barrel, up 20 cents.

The contract had jumped $2.95 to a record $102.59 a barrel on Thursday.
 
Crude prices are within the range of inflation-adjusted highs set in early 1980. A $38 a barrel of oil then would be worth $97-$104 or more at current levels, depending on the how the adjustment is calculated.

Nymex heating oil rose 0.82 cent to $2.8538 a gallon while natural gas futures added 0.1 cent at $9.444 per 1,000 cubic feet.

In London, Brent crude futures rose 9 cents to $100.99 a barrel on the ICE Futures exchange.

Oil prices were supported by comments by Federal Reserve chairman Ben Bernanke, that the American economy is not immediately threatened with stagflation.