Oil hits record near US$106 (+video)

Oil hit a record high near US$106 this morning, fueled by the weak US dollar and Opec's decision to hold crude output steady.

US oil jumped 43 cents to US$104.95 a barrel by 1908 GMT, off the record US $105.97 a barrel struck earlier in the day.

London Brent crude rose 50 cents to US$102.14 a barrel, after hitting a record US$102.95.

The gains came after a fall in US crude inventories and the Organisation of the Petroleum Exporting Countries' agreement to maintain production levels pushed oil to settle up US$5 yesterday.

A rise in speculative buying as investors seek a hedge against inflation and the tumbling dollar have also helped propel oil to record levels.

- REUTERS