Crude hits new record highs on supply concerns

15 April 2008 06:22  [Source: ICIS news]

SINGAPORE (ICIS news)--Crude futures hit new record highs in Asian trade on Tuesday morning with NYMEX light sweet crude futures surging back over $112/bbl and ICE Brent climbing above $110/bbl  amid further weakness in the US dollar, stronger gasoline prices, and  concerns over supplies from Mexico and Nigeria.

At 04:46 GMT on Tuesday, May NYMEX light sweet crude futures were trading at $112.34/bbl, up $0.58/bbl from Monday’s settlement price. Earlier, the contract hit a new all time record high of $112.48/bbl, up $0.72/bbl.

At the same time on Tuesday, May ICE Brent futures were trading at $110.40/bbl, up $0.56/bbl from the previous close, after earlier hitting a new all time record high of $110.45/bbl up $0.61/bbl. The May ICE Brent futures contract expires at the close of business on Tuesday.

The US dollar fell back against the Euro and the Yen late on Monday and remained under pressure on Tuesday amid renewed credit crisis concerns ahead of the release of financial results from US banks. 

Crude prices were also buoyed by US gasoline futures, which hit new highs on Monday on demand increases ahead of the start of the US driving season. The US government also said on Monday that gasoline costs for drivers had hit an all time high of $3.39/gal, up 52.3 cents on a year ago.

However the Energy Information Administration (EIA) has forecast that summer US gasoline demand will fall for the first time since 1991 due to high prices.

Crude supply concerns were raised by news that three major Mexican oil export ports in the Gulf of Mexico which handle around 80% of the country’s crude exports remained closed since the weekend due to bad weather.

News of further sabotage attacks on Nigerian production had added further upside pressure on Monday. However, the attack and subsequent fire at a pipeline flow station was heard to have reduced output a relatively small volume of 5,000 bbl/day.
By: James Dennis
+65 6780 4359

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