08 October 2004	Friday	22 Shaban 1425

LONDON, Oct 7: World oil prices bolted to new record summits on Thursday, reaching $53 in New York on markets nervous about tight global supplies with winter approaching in the northern hemisphere.

Prices continued their seemingly inexorable rise a day after the US Department of Energy reported a smaller-than-expected rise in US crude oil inventories and a fall in heating oil.

Oil hits $53 mark amid tight supplies

LONDON, Oct 7: World oil prices bolted to new record summits on Thursday, reaching $53 in New York on markets nervous about tight global supplies with winter approaching in the northern hemisphere.

Looming strike action in major oil producer Nigeria was adding further support to prices, analysts said. The price of reference light sweet crude for November delivery spiked at $53 a barrel in opening deals on the New York Mercantile Exchange, the highest level in the contract's 21-year history.

US crude futures later eased to $52.30, a gain of 28 cents from the day's previous closing price. In London Brent North Sea crude oil for delivery in November surged above $49 a barrel for the first time, hitting $49.20 a barrel in afternoon trading. It stood at $48.62 in late deals, a gain of 63 cents.

Prices continued their seemingly inexorable rise a day after the US Department of Energy reported a smaller-than-expected rise in US crude oil inventories and a fall in heating oil.

Ongoing supply problems in the Gulf of Mexico were also causing concern. "There's a lot of concern surrounding the levels of stocks in the US," said Veronica Smart, an analyst at the Energy Information Centre, a British-based consultancy.

"We're approaching winter when demand is obviously higher, particularly for gasoline. If we do have a particularly harsh winter I think supplies could struggle." In the event of a cold snap, "we could definitely see Brent breaking $50 a barrel and heading further up," she predicted.

Weekly US crude oil and gasoline inventories rose modestly as importers and refiners began to recover from Hurricane Ivan, the Energy Department said on Wednesday. Almost 27 per cent of the Gulf of Mexico's 1.7 million barrels of daily oil production remains disrupted, according to the US Department of the Interior.

"A smaller than expected build in US crude oil inventory and a counter-seasonal draw in heating oil combined with the continued outage of almost 500,000 barrels per day of Gulf of Mexico crude oil production continues to provide a solid underpinning to the crude oil market," said Barclays Capital analyst Kevin Norrish.

"Threats of a strike by Nigerian oil workers are also keeping the market on edge," he added shortly before Nigerian labour unions vowed to go ahead with a threatened nationwide general strike to protest against rising fuel prices, threatening to bring the economy of Africa's biggest oil exporter to a halt. -AFP