LONDON, June 27: Oil prices struck record highs above $142 on Friday as the US currency weakened and stock markets tumbled at the end of a volatile week for investors worldwide.

New York light sweet crude hit a historic peak of $142.26 a barrel and Brent North Sea crude reached an all-time high of $142.13.

“Crude oil futures made fresh record highs, with higher oil prices fuelling inflationary fears and thus hurting stock markets, which in turn triggered a further rally in commodities as investors seek better returns,” Sucden analyst Michael Davies said in London.

Prices “continued to be buoyed by the dollar as the greenback continues its free fall descent this week,” he added.

Opec’s president on Thursday predicted that oil prices could reach $170 this year owing to a weak dollar and geopolitical unrest.

Crude futures crossed $140 for the first time on Thursday following the price forecast made by Opec’s president, Algerian Energy Minister Chakib Khelil, in an interview with television news channel France 24.

After the records set on Friday, New York’s main oil futures contract, light sweet crude for August, slipped back to $140.85, still showing a gain of $1.21 from Thursday’s close as traders banked their profits.

Brent North Sea crude for August stood at $140.81, up 98 cents.

The cost of oil has doubled in a year, with consumers blaming the surge on insufficient output from the Organisation of Petroleum Exporting Countries.

However Opec, which produces 40 per cent of the world’s oil, argues that speculators are responsible for pushing up prices in reaction to a falling dollar and tensions in oil-producing countries, such as Iran, Iraq and Nigeria.

A weak US currency makes oil priced in dollars cheaper for foreign buyers, thus pushing up demand for the commodity.

In a volatile trading week, oil prices had closed down $3.50 on Wednesday after official data revealed an unexpected rise in stockpiles in the United States, the world’s biggest energy consumer.

The US Department of Energy said crude stockpiles had risen for the first time in six weeks, by 800,000 barrels, in the week to June 20. Analysts had expected a drop of 1.1 million barrels.

Oil prices had rallied at the start of the week after major energy producers ruled out significant output increases.—AFP