Oil prices nudge record high

Oil prices were hovering close to last week’s record high today after breaking through the $50 mark again.

Production problems in the Gulf of Mexico due to the impact of Hurricane Ivan continued to have an impact, while anxiety over unrest in Nigeria and Iraq also contributed to the latest surge.

The cost of a barrel of crude oil in New York soared to $50.40 today - just a fraction lower than last week’s high of $50.47.

Brent crude – found in the North Sea and traded on the International Petroleum Exchange in London – rose to $46.56, following last week’s record level of $46.80.

Richard Slape, oil analyst at Seymour Pierce in England, said the rise in prices was a continuation of recent events.

“Hurricane Ivan had a strong impact on prices,” he said. “It affected imports into the US and took a lot of production down in the Gulf of Mexico.”

He said the latest figures showed the amount of oil coming out of the Gulf of Mexico was still lower, even three weeks after the hurricane.

Last week’s surge was fuelled by factors including political unrest in Nigeria’s oil producing region and continued instability in the Middle East.

Prices had dropped back after a truce between Nigerian oil rebels and the government, but Mr Slape said there was still concern that trouble could flare up.

He added: “Nigeria’s always been pretty volatile and I guess it will continue to be so.”