labels: Economy - general
Oil soars past $145 a barrel as dollar dips to a 2-month low against euro news
03 July 2008

Mumbai: Crude oil prices rose above $145 a barrel for the first time, extending a price rally amidst tension in the Middle East and a weak US dollar that dipped to a two-month low against the euro.

North Sea Brent crude for August delivery rose $1.06 to $145.32 from Wednesday close of a record $144.26 in London while US light sweet crude hit an intra-day record of $144.61, against a record New York close of $143.57 on Wednesday.

The latest surge was aided by a warning from key oil producer that it would react fiercely to any US or Israeli attack against it.

The market also took note of a possible attack - or even an attempted attack - by Islamic extremists on Saudi Arabia's oil sector that would have disastrous consequences on supplies.

While unrest has also cut output in key African producer Nigeria, a weaker US currency also made commodities like oil denominated in the greenback cheaper for buyers with stronger currencies.

In an interview published on Wednesday, OPEC secretary general Abdallah el-Badri argued that the lack of oil supplies was a ''myth" and the real culprit was Western speculation sparked by a crisis in the US subprime mortgage sector.

He also asked the US authorities to stop "harassing" members of the Organisation of the Petroleum Exporting Countries.

Global supply of oil, at 86.7 million barrels per day, more than matches demand for oil, which is pegged at 86.6 million barrels per day. Global oil supplies are thus more than adequate to meet demand this year, according to projections by the US Energy Information Administration.

Oil prices, however, have doubled in the past year and have risen by 45 per cent in the current year.


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Oil soars past $145 a barrel as dollar dips to a 2-month low against euro