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Oil looks set to test $139 record Larry Elliott The price of crude oil tonight looked set to test last week's record of almost $140 a barrel after reports of falling stocks in the US prompted a fresh wave of speculative buying. In New York, the cost of a barrel of crude in the futures market was up some $6 to more than $137 a barrel following an increase of almost $4 in London for Brent crude, which closed at almost $135. The sharp increase in prices followed a report from the US government showing oil stocks had fallen for a fourth week. It coincided with reports of fresh supply problems in Nigeria and a 25% increase in oil imports in China ahead of this summer's Beijing Olympics. (Article continues below)
With the weaker dollar also prompting speculative buying, markets were braced for oil prices to test last Friday's high of $139.12, reached after an $11 surge. Today's gains came after the US Energy Information Administration reported falling imports meant crude stockpiles dropped 4.6m barrels last week. Inventories of crude in the world's biggest energy consumer have fallen by 7% since early May, intensified by concerns that global oil production is failing to keep pace with rising demand from developing Asian economies. Oil prices have risen nearly sevenfold since 2002, driven by rising demand from China and other developing countries.
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