LONDON, July 26: The price of New York crude leapt above $77 a barrel on Thursday, reaching the highest level since last August, as keen global demand and tight supplies fuelled speculative buying, traders said.

New York’s main oil futures contract, light sweet crude for delivery in September, struck $77.24 -- a level last seen on August 9, 2006.

Later Thursday it stood at $76.75 a barrel, up 87 cents on the day.

New York's all-time high stands at $78.40, set a year ago.

In London, Brent North Sea crude for September delivery gained 68 cents to $77 per barrel on Thursday. Its all-time high is $78.64.

“Crude futures were higher, extending Wednesday’s gains,” Sucden analyst Michael Davies noted.“Market participants have decided to turn their attention back to fuel inventories,” he said.

On Wednesday, the US government revealed that inventories of American crude fell by 1.1 million barrels last week.

“A close look at the data shows a system straining against seasonally rising demand to catch up with product stock deficits accumulated through months of extended (refinery) outages,” said Fimat analyst Antoine Halff.

Crude prices had begun the week lower after Opec President and United Arab Emirates Energy Minister Mohammed al-Hamli expressed concern over surging prices and said the group was prepared to pump more crude oil if needed.

The Organisation of Petroleum Exporting Countries holds its next output meeting on September 11 in Vienna, where the 11-nation cartel's headquarters is located.

The International Energy Agency, which has called on Opec to pump more crude, raised its 2008 forecast for oil demand by 2.5 per cent to 88.2 million barrels a day earlier this month.—AFP