New York crude oil prices reached $80 a barrel on Wednesday for the first time as the market fretted over declining United States reserves and a new tropical storm in the Gulf of Mexico.
Prices shot higher after news that US crude reserves fell by a sharper-than-expected 7,1-million barrels over the past week.
”The seven-million barrels drop in crude oil stocks was the primary surprise” of the Department of Energy report, Citigroup analyst Tim Evans said.
Also pushing prices higher was news of the formation of Tropical Storm Humberto, which could affect oil installations in the Gulf of Mexico.
Organisation of the Petroleum Exporting Countries ministers meeting in Vienna agreed on Tuesday to raise production quotas to provide an extra 500 000 barrels of oil a day to world markets, but most traders viewed that as a symbolic move that would do little to help ease the supply crunch.
At 6.30pm GMT, the contract for light, sweet crude for October delivery was $79,83, a jump of $1,60, after peaking at $80.
In London, the price of Brent North Sea crude for October delivery climbed $1,33 to $77,71 per barrel after rising as high as $77,93, approaching the all-time high of $78,60. — Sapa-AFP