Oil prices at new high
Oil prices reached a new high above 117 US dollars a barrel last week amid further fears over supply.
Light, sweet crude for May delivery touched $117.05 in early trading on the New York Mercantile Exchange, continuing last week's record run.
Weekend comments by Opec officials that the oil cartel is unlikely to increase production as well as an attack on a pipeline in Nigeria boosted prices.
Prices settled back around 50 cents after the spike, but are still around five dollars higher than this time last week. They are also up more than 20 per cent from the 96-dollars-a-barrel level seen at the start of this year.
Opec secretary-general Abdullah el al-Badri said oil prices would likely go higher and that the group was ready to raise production if the price pressure was due to a shortage of supply - something he doubted. "Oil prices, there is a common understanding that has nothing to do with supply and demand," he said at an energy conference in Rome.
Oil giant Royal Dutch Shell's pipeline in the country's unstable Niger Delta region was also attacked by militants on Friday.
The commodity's record run has caused misery at the petrol pump for millions of motorists, as well as endangering the Bank of England's efforts to keep inflation under control.
The AA motoring organisation has warned that drivers could soon face average unleaded petrol costs of more than £5 a gallon, with further pain due in October when Chancellor Alistair Darling's latest fuel duty hike comes into force.
Dollar weakness has also been a factor in the higher prices as traders have bought oil as a hedge against the faltering currency, pushing up costs.
The weakness of the greenback has come as the US Federal Reserve slashes interest rates in a bid to revive a growing slump in the world's largest economy following the eruption of last year's credit crisis.
Image: Oil prices continue to rise