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Submitted by ctv_en_2 on Thu, 11/22/2007 - 10:30
Crude oil prices rose above a record US$99 per barrel on November 21 as worries about inadequate winter supplies in the Northern Hemisphere and news of refinery problems stoked bullish sentiment.

The declining US dollar and speculation that the US Federal Reserve will again cut interest rates also boosted prices. Some investors put their money into oil contracts, betting that gains in their price will offset the dollar weakness.

 

“The market is now really looking at US$100 a barrel as the next target to hit,” said Victor Shum, an energy analyst with Purvin & Gertz in Singapore.

 

Light, sweet crude for January delivery rose as high as US$99.29 a barrel in electronic trading after the New York Mercantile Exchange closed, breaking the previous intraday record of US$98.62 set last week.

 

In Europe the contract was trading at US$98.04 a barrel - up 1 cent on Novermber 20's close. Brent crude for January delivery was little changed at US$95.88.

 

The contract surged US$3.39 during the floor session in New York on November 20 to a record close of US$98.03 a barrel.

 

Beyond these temporary concerns, investors are anxious that as global demand for energy grows, fuelled by China and India's rapid development, oil supplies won't be able to keep up.

 

Currently, oil producers are turning out about 85 million barrels a day, while the US Department of Energy says consumption is between 85 million and 86 million barrels a day.

 

CNN

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