7 June :Oil prices have shot up more than USD 11 to a new record above USD 139 after Morgan Stanley predicted prices would hit USD 150 by the 4th of July.
Oil’s meteoric surge, which pushed prices more than 8 percent higher in a single day, added to a huge increase on Thursday to cap oil’s biggest two-day gain in the history of the New York Mercantile Exchange.
The burst higher — which also came on rising Middle East tensions — also raised the prospect of accelerating inflation by adding to already strained transportation costs.
That gloomy outlook sent stocks tumbling, taking the Dow Jones industrials nearly 400 points.Light, sweet crude for July delivery jumped as high as USD 139.12 on the Nymex, before easing slightly to settle at USD 138.54, up USD 10.75.
Prices hit a previous record of USD 135.09 a barrel on 22nd May, and settled Thursday at USD 127.79.Brent crude on the ICE futures exchange settled USD 10.15 higher at a record USD 137.69 a barrel, after hitting an all-time high of USD 138.12 a barrel.
Prices pushed sharply higher on Friday after Morgan Stanley analyst Ole Slorer predicted strong demand in Asia could drive prices to USD 150 by Independence Day (July 4), when millions of Americans are expected to take to the roads.
Slorer said shipments from the Middle East are mimicking patterns seen in the third quarter last year,when Morgan Stanley based an oil price spike prediction on falling supplies in the Atlantic.
Traders also zeroed in on remarks by an Israeli Cabinet minister, who was quoted as saying his country will attack Iran if it doesn’t abandon its nuclear programme.
Transportation Minister Shaul Mofaz added that Iranian President Mahmoud Ahmadinejad "will disappear before Israel does," the Yediot Ahronot daily reported. Courtsey : DD NEWS