LONDON, 4 August 2004 — US oil prices hit fresh record highs above $44 a barrel yesterday after the head of OPEC said there was no extra oil around the corner to dampen red-hot markets.
The relentless rise in oil prices has heightened concern about economic growth, with high energy costs pushing US consumer spending to its biggest fall in three years.
US light crude struck $44.24 a barrel, the highest since crude futures were launched on the New York Mercantile Exchange in 1983. It later fell to trade firm around $44.
London’s Brent crude followed suit, scoring $40.52 a barrel, a level not seen since the run-up to the first Gulf War when it hit an all-time high of $40.95.
“It’s just up, up and away. There’s no stopping it,” said Edward Meir, an analyst at Man Energy, adding some brokers believed US oil at $50 a barrel was no longer inconceivable.
Oil prices have surged by more than one-third since the end of 2003 on worries that accelerating global demand has left supplies tightly stretched with little leeway for disruption.
OPEC President Purnomo Yusgiantoro said yesterday the group had no spare oil to hand.
“The oil price is very high, it’s crazy. There is no additional supply,” Purnomo told reporters in Jakarta.
“Minister Naimi has said Saudi Arabia can increase production but they cannot do it immediately,” he said, referring to Ali Al-Naimi, the Saudi oil minister.
Saudi Arabia has said it would produce 9.5 million barrels per day in August, which would be just one million bpd below the country’s full capacity.
Purnomo’s comments echoed those on Monday of Algerian Oil Minister Chakib Khelil, who said OPEC had done all it could to stop this year’s oil price rally.
