28-02-2008
Oil price hit new high
News by Adfero for Simply Business - independent providers of public liability insurance, business finance, landlord insurance, buy-to-let mortgages & commercial mortgages.
Oil prices reached a new high during trading yesterday (February 27th).
The market price of US sweet crude yesterday increased to $102.08 (£51.52) per barrel as a consequence of investments shifting towards commodities rather than currencies and company shares, reports the BBC.
"Commodities are generally considered a hedge against inflation. We are therefore seeing these strong prices that have really little to do with oil market fundamentals," said Victor Shum, an analyst specialising in energy at Purvin & Gertz in Singapore. "The US dollar weakened against the euro and the economic data also indicated that inflation in the US rose in January."
However, when figures are adjusted for inflation, yesterday's price is still lower than the cost of oil in 1980, when prices to a high of $102.53, according to the International Energy Agency, a body established by the Organisation for Economic Co-operation and Development in 1974.
At the close of trading, US sweet crude prices had again fallen, with markets closing at a price of $99.64 per barrel.