Oil prices leapt to a new peak of more than US$126 a barrel yesterday, hitting a record for the fifth straight session, in a market given an additional spur by tight supplies of diesel.
United States crude for delivery next month rose as much as US$2.51 to US$126.20 a barrel. London Brent crude rose US$2.81 to US$125.65 per barrel.
Wall Street opened sharply lower, in response to the latest hike and news that insurance giant AIG had reported a deeper-than-expected quarterly loss.
At 11pm Singapore time, the Dow Jones Industrial Average was down 89.56 points at 12,777.22.
‘I’m not particularly surprised by the speed of the rise in crude. There are many market bulls hoping for prices to rise heading into the summer,’ said Mr Tetsu Emori, a fund manager at Astmax in Tokyo.
Gains in US crude picked up momentum after distillate stocks in America, notably diesel, fell.
The US said on Wednesday that domestic distillate stocks, which include diesel, fell by 100,000 barrels last week, against forecasts for an 800,000-barrel rise.
The tightness in the stocks was also highlighted after Royal Dutch Shell looked set to shut its second-largest crude distillation unit and two secondary units at its Singapore plant next month for routine maintenance.
