16 April 2006

Oil prices likely to surge to new record highs

Oil prices likely to surge to new record highs | Reuters.com: "LONDON (Reuters) - An influx of fresh fund buying and geopolitical worries will most likely push oil prices to new record highs soon, analysts said on Tuesday, while the most bullish predicted prices to eventually climb to $100 a barrel.
Supply concerns in Nigeria, Iran and other key oil-producing countries have ignited U.S. crude prices, up 13 percent this year and within $2 of the all-time record high of $70.85, reached in late August 2005 in the wake of hurricane damage in the United States.
Analysts predicted the market to rally even further as high oil prices have failed to reduce global demand.
'It is pretty clear that we can break $70 without too much problem,' said Deborah White, an analyst at SG CIB Commodities in Paris.
'We have been getting a massive injection (of investment fund money) in the commodity markets. It is very clear from the price action that they haven't stopped.'
Analysts said prices could peak at around $80 a barrel, a level that matches inflation-adjusted prices set after the 1979 Iranian revolution.
Twenty-seven years later, the market is again focused on the Middle East country as Tehran battles with the West over its nuclear program.
'Even without a possible Iranian oil disruption, we could go to $75 to $80 a barrel,' said Olivier Jakob of Swiss-based Petromatrix, an oil analysis "

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