Oil hits record, Britain calls for OPEC hike

NEW YORK Tue Apr 15, 2008 10:08pm IST

Oil facilities are seen on Lake Maracaibo in Venezuela in this March 1, 2008 file photo. Oil prices jumped to a new peak near $114 a barrel on Tuesday amid lingering supply worries and weakness in the U.S. dollar, deepening concern in world consumer nations that a spike in energy costs could cause severe economic damage. REUTERS/Jorge Silva/Files

Oil facilities are seen on Lake Maracaibo in Venezuela in this March 1, 2008 file photo. Oil prices jumped to a new peak near $114 a barrel on Tuesday amid lingering supply worries and weakness in the U.S. dollar, deepening concern in world consumer nations that a spike in energy costs could cause severe economic damage.

Credit: Reuters/Jorge Silva/Files

Related Topics

Priyanka Gandhi Vadra, daughter of Congress party chief Sonia Gandhi, adjusts her flower garlands as she campaigns for her mother during an election meeting at Rae Bareli in Uttar Pradesh April 22, 2014. REUTERS/Pawan Kumar

Election 2014

More than 814 million people — a number larger than the population of Europe — are eligible to vote in the world’s biggest democratic exercise.  Full Coverage 

NEW YORK (Reuters) - Oil prices jumped to a new peak near $114 a barrel on Tuesday amid lingering supply worries and weakness in the U.S. dollar, deepening concern in world consumer nations that a spike in energy costs could cause severe economic damage.

Britain's prime minister, Gordon Brown, on Tuesday called on OPEC members to boost production to counter rapidly rising oil prices, which have shot up 80 percent since a year ago, adding his voice to similar requests from the administration of U.S. President George W. Bush.

"We are not producing enough oil ... and we can take collective action to persuade OPEC and others to get the oil price down," Brown said in an interview on Sky Television.

U.S. crude rose $1.80 to $113.56 a barrel by 1545 GMT, after touching a record high of $113.93. Oil is up about 18 percent from the start of the year and more than 80 percent since last April.

London Brent crude was up $1.73 at $111.57, after hitting a record high of $111.85.

Oil and other commodities have rallied in recent months due to record weakness in the U.S. dollar. A weak dollar tends to raise prices for commodities denominated in that currency by boosting non-U.S. spending power and by attracting investors seeking an inflation hedge.

"One thing that is clearly driving the oil price is that the U.S. dollar has gotten substantially weaker in the past several months and quarter," said Richard Batty, energy analyst at Standard Life.

The dollar recouped some losses versus the euro Tuesday after U.S. Treasury data showed foreigners increased purchases of U.S. assets in February.

Oil dealers said they were also closely monitoring oil shipments from Mexico, the world's 10th-largest crude exporter, after foul weather interrupted operations at its three main oil ports over the weekend.

The Mexican government said on Tuesday that two of the ports had reopened, but one remained shut for the third straight day.

Adding to worries over tight supply, Chinese data showed imports of diesel zoomed higher in March. China's March crude oil imports also rose sharply, up 25 percent from a year ago, according to data released last week.

Despite surging oil prices, OPEC says it is producing enough and that a U.S. economic slowdown may weaken consumption in the second quarter.

"Current OPEC production at more than 32 million barrels per day will be sufficient to both meet demand growth and contribute to further stockbuilds," the Organization of the Petroleum Exporting Countries said in its latest Monthly Oil Market Report.

OPEC, which pumps more than a third of the world's oil, has pointed to U.S. dollar weakness, speculative inflows and political tensions as key factors driving prices rather than a lack of oil.

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

REUTERS SHOWCASE

Caste Bias

Caste Bias

Bigoted teachers lead marginalised Indian school kids to drop out - HRW.  Full Article 

Ferry Tragedy

Ferry Tragedy

Divers feel with their hands for corpses in depths of S.Korean ferry.  Full Article 

Australia Determined

Australia Determined

Australia vows to keep searching to solve missing Malayasian plane mystery.  Full Article 

Guns and Gowns

Guns and Gowns

Film “The World Before Her” juxtaposes two faces of Indian woman.  Full Article 

Mobile Ads

Mobile Ads

Google extends reach into mobile apps with new ad feature.  Full Article 

Allegations Denied

Allegations Denied

Allegations of teen sex abuse by three Hollywood execs denied.  Full Article 

Rising Tensions

Rising Tensions

U.S. vows more sanctions on Russia unless tensions ease in Ukraine.  Full Article 

Need for Speed

Need for Speed

United must move fast with vital window looming.  Article 

Afghanistan Exit

Afghanistan Exit

Exclusive - U.S. force in Afghanistan may be cut to less than 10,000 troops  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage