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Oil Prices reach record high

Source: Sydney Herald

World oil prices were trading at more than 100 US dollars per barrel Thursday after spiking to a new record amid speculation OPEC may decide to slash production at a meeting next month, dealers said.
New York's main oil futures contract, light sweet crude for delivery in March, touched an all-time peak of 101.32 US dollars in electronic trading before it lapsed.

Oil prices could go even higher, said David Moore, a commodity strategist at the Commonwealth Bank of Australia.

He said that in the near-term the oil market will be "heavily influenced" by any decision of the Organisation of Petroleum Exporting Countries (OPEC) on output levels at its next meeting on March 5.
OPEC ministers kept the official daily output ceiling at 29.67 million barrels of oil at an emergency meeting on February 1, resisting calls from US President George W. Bush to increase supplies to help bring down prices.
But the market is rife with speculation that OPEC, which supplies about 40 percent of the world's oil, would keep steady or even decide to cut production.

Phil Flynn, an analyst at Chicago-based Alaron Trading, commented that the run-up in oil was "not about current supply but about the perceived threat to future supply ... it is obvious that this market is paranoid about less oil even in a slowing economy."

Libya's oil chief Shukri Ghanem said that OPEC will wait to see if oil prices hold around record highs of 100 US dollars before making any decision on whether to cut output.
Ghanem told AFP that with prices at current levels, OPEC wanted to see if 100 US dollars per barrel proves to be the ceiling or if they would begin to fall back.

An ongoing row between US energy giant ExxonMobil and Latin American crude oil exporter Venezuela, and unrest in Africa's biggest oil exporter Nigeria, also added to jitters among investors, analysts said.
The legal battle relates to ExxonMobil's bid to secure compensation after Venezuela's government nationalised key oil fields in the Orinoco basin, including two ExxonMobil operations

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