LONDON, Aug 1: The price of New York oil soared to a record high of $78.77 a barrel on Wednesday, as plunging US crude inventories stoke fears about stretched energy supplies around the world, traders said.

New York’s main futures contract, light sweet crude for delivery in September, leapt to the all-time high after the US Department of Energy said that US crude stocks sank by 6.5 million barrels in the week ended July 27.

That was far heavier than market expectations for a drop of 1.13 million barrels.

“The US statistics that came out today surprised a lot of people in terms of the extent of the draw,” said BNP Paribas analyst Harry Tchilinguirian.

“It surpassed people's expectations,” he added.

The news had a big impact on the global oil market because the United States is the world’s biggest consumer of energy, analysts said.

Fuelled by fierce global demand and tight supplies, oil prices in London and New York have rocketed over the past two months by $12 to reach dizzy heights above $78 a barrel.

Wednesday’s new US record smashed the previous all-time high of $78.40 that was set on July 13, 2006, amid violence between Israel and Lebanon in the oil-rich Middle East.

It also beat London Brent’s historic high point of $78.64 per barrel, which was set on August 7, 2006, after a pipeline spill forced British firm BP to close output from Prudhoe Bay, the biggest oil field in the United States.

According to Tchilinguirian, oil prices could head even higher if global supplies face new disruption.

“Any further price increase could be from some sort of escalating geopolitical tension or supply disruption centred around key producers, like the situation last year when we had the crisis in Lebanon.”

American crude stocks, which remain at relatively high levels overall, have been declining for some weeks at Cushing, Oklahoma -- the delivery point for the New York contract.

Last week, crude prices spiked higher after the DoE revealed that crude inventories had fallen by 1.1 million barrels.

Later on Wednesday, New York crude pulled back slightly to $78.41, which was 20 cents higher than Tuesday’s close.

But in London, the price of Brent North Sea crude for September delivery fell 53 cents to $76.52 per barrel.Runaway prices have sparked repeated calls from the International Energy Agency for Opec to hike output in order to calm the market.

The Organisation of the Petroleum Exporting Countries, which pumps about 40 per cent of global crude oil supplies, has insisted that recent oil price gains are due to geopolitical reasons and not tight global supplies.

The cartel holds its next output meet on September 11 in Vienna, Austria.—AFP