LONDON, July 16: The price of London’s Brent North Sea crude oil soared close to a record high above $78 on Monday amid frenzied speculative buying and concerns over tight US fuel supplies.

Brent North Sea crude for August delivery leapt to $78.40 -- the highest point since August 9, 2006 and close to the record high of $78.64 set two days earlier.

New York’s main oil futures contract, light sweet crude for delivery in August, jumped to $74.50 per barrel, which was last seen on August 11, 2006.

Crude futures climbed on Monday, “extending gains from Friday and once again pushing above $78 per barrel in London,” said Sucden analyst Michael Davies.

“Just as at the end of last week, there is a continuous inflow of fresh speculative and fund money supporting the prices.”

Later on Monday however, Brent crude slipped 11 cents to $77.46 on light profit-taking, while New York crude showed a gain of 47 cents at $74.50 per barrel in floor trading. Traders said Brent oil prices were lifted by upcoming maintenance work in the North Sea, which has exacerbated fears of a supply crunch.

“Tightening supplies from the North Sea region are still seen as supportive of crude futures, while market participants remain concerned about seasonal maintenance on North Sea oilfields at the end of the summer, in addition to unexpected outages,” Davies added.

Traders are also focusing on tight supplies of gasoline or motor fuel in the United States amid the peak-demand driving season.

The US Department of Energy had said last week that gasoline reserves climbed 1.2 million barrels in the week ending July 6, beating forecasts of a gain of 825,000, but they were still 3.8 per cent lower than a year earlier.

“US refineries are rushing to increase gasoline output during the summer driving season,” Davies said.

Prices were also underscored by persistent geopolitical jitters in Nigeria, which is the world’s eighth biggest crude exporter and the largest producer in Africa.

Crude futures had rallied strongly last week after the International Energy Agency raised its 2008 forecast for oil demand by 2.5 percent to 88.2 million barrels a day.

Prices are now within close range of their historic high points.

The Brent oil price touched $78.64 on August 7, 2006, shortly after a pipeline spill forced Britain’s BP to close production from Prudhoe Bay, which is the biggest oil field in the US.—AFP