NEW YORK (AP) -- Oil prices spiked to a new record Friday, then held on to most of their gains after traders failed to respond to efforts by the U.S. and Saudi Arabia to boost supply.

Light, sweet crude for June delivery was up $2.20 at $126.32 in afternoon trading on the New York Mercantile Exchange. Prices rose as high as $127.82 a barrel, a new record, earlier in the session.The previous trading record was $126.98.

Saudi Arabia's Oil Minister, Ali Naimi, said the country increased production by 300,000 barrels a day last week in response to requests from customers.

(Article continues below)

Meanwhile, the Energy Department said it would cancel shipments into the Strategic Petroleum Reserve for six months beginning July 1. The move came days after Congress passed legislation requiring the president to suspend the shipment into the reserve in hopes of lowering gasoline prices.

Oil industry observers questioned whether either move would have a significant effect on soaring energy prices.

"It's ridiculous because I don't think this is going to bring the price down," said Phil Flynn, analyst at Alaron Trading Corp, of the Energy Department's move.

FULL STORY: CLICK HERE