LONDON, Jan 20: Oil prices surged on Friday to $68 following Al Qaeda’s purported threat to the United States, which fuelled tensions triggered by potential supply disruptions in Iran and Nigeria.

Global demand for crude, meanwhile, was forecast to rise by 1.9 per cent in 2006 to 84.8 million barrels per day (bpd), the Organization of Petroleum Exporting Countries said in a report that modestly revised down a previous estimate.

New York’s main contract, light sweet crude for delivery in February, jumped 97 cents to $67.80 per barrel in pit trading, after earlier hitting $68 — last seen September 22. The contract expires at the close.

In London, the price of Brent North Sea crude for March delivery gained 89 cents to $66.12 per barrel in electronic dealing after earlier touching $66.46.

“There is nothing in the market that says prices should come off at the moment,” said Man Financial trader Lee Elliott.

There was a “strong possibility” of new records as early as the end of next week, he said, adding that “you would not want to sell on the back” of the terrorist threat and continued problems in Iran and Nigeria.

Nigerian oil workers’ unions meanwhile threatened on Friday to withdraw their members from the troubled Niger delta region if the government fails to stop continuing violence there.

And Iran, the second-biggest crude producer in Opec, has asked the cartel to reduce its oil production quota by one million barrels per day from April, Tehran’s representative said ahead of a January 31 output meeting.

The comments came amid a simmering crisis over Iran, with Tehran warning the West that UN sanctions over its controversial nuclear programme could provoke a world oil crisis and even higher prices.

Iran’s Opec representative, Hossein Kazempour Ardebili, said on Friday:

“Opec should not postpone the issue of output reduction. Iran has called for carrying out discussions and making decisions for a one million bpd of oil output cut in the second quarter.”

Opec’s production ceiling currently stands at 28 million bpd. At its last meeting in Kuwait on December 12, the cartel decided not to renew an offer of two million bpd in emergency additional output.—AFP