Oil prices hit new highs in NY

Fears over supply shortages drove oil prices to fresh highs today despite signs oil cartel Opec could move to cool the market.

The cost of a barrel of light crude oil rose to a record $57.79 in New York today – its highest level since trading began – before slipping back to $57.53.

In London, the price of Brent crude oil also hit a new peak of $56.89 a barrel.

Opec’s president said at the weekend that he would start talks with members about increasing oil supplies.

The group had left open the possibility of raising supply by up to 500,000 barrels a day at its last meeting in March, although there are concerns this will not be enough. Opec did hike production last month but that failed to cool down prices.

Today’s increase in the cost of oil came as Asian markets started trading for the first time since an investment bank warned prices could surge to $105.

Goldman Sachs warned on Friday that markets had entered a period where strong demand and tight supplies could cause a “super spike” in prices.

Factors contributing to the sky-high cost of oil include concerns over political turmoil in oil-producing countries, as well as fears of a summer shortage in the United States.

The market has also fretted over the impact of a fatal explosion at a BP refinery in Texas, which accounts for 3% of the supply of petroleum products in North America and processes 430,000 barrels of crude oil a day.