KEY POINTS:
Oil shot above US$99 ($130) a barrel for the first time yesterday, drawing within a hair of the US$100 mark as the US dollar plumbed new lows.
US light crude for January delivery rose by more than US$1 to set a new all-time high of US$99.29 a barrel, adding to Tuesday's 4 per cent surge and blowing past the previous record US$98.62 first touched on November 7.
The contract was US$1 higher at US$99.03 a barrel, up more than 60 per cent since the start of the year and over 40 per cent since mid-August, the beginning of a fund-led rally built on the weakening US dollar and concerns that limited Opec supplies may leave the market short this winter.
London Brent crude rose 91c to US$96.40 a barrel.
Oil has been rising inversely to the US dollar over the past months amid a fever of speculative trading. The falling dollar helps protect demand for oil in non-dollar economies and could prompt Opec producers to sustain a higher price to offset the reduced purchasing power of petrodollar revenues.
The US dollar touched a new record low against the euro on Tuesday and hovered near it yesterday after the US Federal Reserve said growth would likely slow next year.
- Reuters
