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UpstreamOnline: Oil races to new record

By Upstream staff

US crude oil futures rocketed past $104 on Wednesday following word that US crude stocks fell unexpectedly last week.

Nymex April crude was up $4.58, or 4.6%, at $104.10 a barrel, having traded from $99.55 to a record $104.56, eclipsing the record $103.95 reached on Monday.

London Brent was $2.77 up at $100.29 a barrel, off highs of $100.59.

Prices increased after the US Energy Information Administration said US crude stockpiles posted a surprise draw last week as refiners boosted output and imports sagged.

US Energy Secretary Sam Bodman said that record high oil prices are due more to low global petroleum inventories than to a weaker US dollar and market speculators.

“Of greater importance is the fact that we have seen a decline in global inventories, that’s what’s affecting in my judgment…the price of oil,” Bodman said in an interview on Bloomberg TV.

“They (Opec members) see speculation in the market. I see a decline in global inventories and I think that is what’s driving this,” Bodman said.

Opec voted today to keep output levels steady, stating that there is no lack of oil in the market. Opec ministers have repeatedly said the market has been driven upwards by factors such as a weak dollar, speculation and political strife.

Meanwhile, Venezuelan Oil Minister Rafael Ramirez blamed ExxonMobil’s legal actions against Venezuela for keeping oil prices high.

Speaking from the Opec meeting in Vienna, Ramirez said Venezuela was presenting legal arguments in a London court to “ensure this type of action does not become a precedent that would help destabilise the global oil market.”

“All of these actions by transnational companies … against producer nations are keeping oil (prices) at their current levels,” Ramirez said.

Opec expressed support for Venezuela and its state oil company PDVSA in exercising sovereign rights as part of President Hugo Chavez’s nationalization campaign last year. ExxonMobil recently won court orders freezing up to $12 billion in assets as part of a dispute over Venezuela’s 2007 nationalisation of an oil project formerly run by the US oil giant.

05 March 2008 17:29 GMT  | last updated: 05 March 2008 18:15 GMT and its also non-profit sister websites,,,,, and are all owned by John Donovan. There is also a Wikipedia article.

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