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Oil price rises to all-time high Oil prices pull back from record
(about 7 hours later)
Oil prices have climbed to a record high of $78.71 a barrel amid worries about whether oil supplies can meet global demand. Oil prices have fallen back after hitting a record high of $78.77 a barrel amid worries about whether supplies can meet global demand.
The price of a barrel of US light, sweet crude passed the previous high of $78.40 a barrel, reached in July 2006. The price of a barrel of US light, sweet crude surpassed the previous high of $78.40 a barrel, seen in July 2006, before falling back to $76.53.
Prices have risen steadily in the past few weeks following disruption to output in Nigeria and the North Sea and set a new closing high on Tuesday. Prices have risen steadily in the past few weeks following disruption to output in Nigeria and the North Sea.
The latest rise was triggered by data showing a fall in US crude stockpiles. Wednesday's initial rise followed data showing a fall in US crude stockpiles.
Falling stocksFalling stocks
The Department of Energy said that oil inventories had fallen by a higher-than-expected 6.5 million barrels in the week ending 27 July.The Department of Energy said that oil inventories had fallen by a higher-than-expected 6.5 million barrels in the week ending 27 July.
Analysts had been forecasting a far more modest fall of about 700,000 barrels.Analysts had been forecasting a far more modest fall of about 700,000 barrels.
These numbers are enough to keep the crude rally alive Jim Ritterbusch, energy analyst Experts said the later fall in the price was due to a decline in gas prices and a feeling that, with the peak summer holiday season nearing its end, prices may have peaked.
Oil markets have withstood recent stock market turbulence, taking their lead from positive economic signs in the US about employment and consumer confidence.Oil markets have withstood recent stock market turbulence, taking their lead from positive economic signs in the US about employment and consumer confidence.
Despite a rise in output from the members of the Opec oil producers' cartel last month, traders are still worried about the amount of spare capacity in the market amid robust demand and continuing instability in oil-rich Nigeria. Despite a rise in output from the members of the Opec oil producers' cartel last month, traders are still worried about the amount of spare capacity in the market.
"The market is looking closely at the unexpected large draw in crude stocks," said Jim Ritterbusch, president of energy analysts Ritterbusch and Associates. US Energy Secretary Sam Bodman said Opec needed to commit to raising production levels when it met next month.
"These numbers are enough to keep the crude rally alive." "I am concerned that we probably are going to need more oil," he said.
The previous $78.40 high was recorded during the Israel-Lebanon conflict last year.The previous $78.40 high was recorded during the Israel-Lebanon conflict last year.
In London, Brent crude fell 15 cents to $76.90 a barrel. In London, Brent crude fell $1.70 to close at $75.35 a barrel.