LONDON, 2 June 2004 — World oil prices rocketed by two dollars a barrel yesterday, setting a new record in New York on fears terrorists may hit supplies from Saudi Arabia, the world’s biggest exporter.
Worries about the threat of further violence in the Kingdom intensified after the weekend attacks in Alkhobar while efforts by OPEC producers to calm the market fell on deaf ears.
New York’s light sweet crude contract for delivery in July soared to $42 a barrel in early deals, the highest level in the 21-year history of the contract.
Prices later stood at $41.80, up $1.92 a barrel from Friday’s close.
In London the price of benchmark Brent North Sea crude oil for July delivery jumped by $2.08 to $38.68 in late afternoon trading.
Both markets had been closed on Monday for a public holiday.
The price surge came despite expectations that OPEC producers meeting in Beirut this week will agree to raise the group’s output quota of 23.5 million barrels per day in response to record high prices.
OPEC has reached “near consensus” to raise its crude oil production, Qatari Energy Minister Abdullah Bin Hamad Al-Attiya told AFP in the Lebanese capital ahead of the group’s formal meeting tomorrow.
He said the Organization of Petroleum Exporting Countries would do “everything it can” to calm the market.
US Secretary of State Colin Powell expressed “confidence in the ability of the Saudi Arabians to continue to provide a secure flow of oil products.”