Oil price closes in upon 65 dollars on US market
(Xinhua)
Updated: 2005-08-11 11:30

Crude oil futures rose sharply Wednesday, touching 65 US dollars a barrel before settling at a new record high of 64.90 dollars.

On the New York Mercantile exchange, light, sweet crude oil futures for September delivery rose 1.83 dollars to settle at 64. 90 dollars a barrel. Prices reached as high as 65 dollars during intraday session.

Meanwhile, on London's International Petroleum Exchange, the September Brent crude oil futures climbed 2.01 dollars to end at 63.99 a barrel. The Brent oil futures climbed as high as 64.06 dollars per barrel in intraday trading.

The record-breaking surges were triggered by a Wednesday report of the Department of Energy (DoE) that US stockpiles of gasoline inventories fell last week.

US gasoline demand has been running at a robust 1.4 percent higher than a year ago over the past four weeks.

At the same time, sales of new autos, especially gas-guzzling sports utility vehicles, are doing particularly well in the United States, a sign that demand will remain robust in the world's top oil consumer nation.

While consumers' enthusiasm beats soaring energy costs, the future oil output is not optimistic.

Crude oil producers and refiners have struggled to keep up with demand of growth over the past two years, reducing the cushion of spare capacity needed to make up for any sudden shortfall.

The temporary shutdown of the US missions in Saudi Arabia, the world's top oil exporter, due to a security threat added worries to crude output.

In addition, OPEC's second biggest producer, Iran, has pressed ahead with its nuclear work in defiance of the European Union's opposition.

OPEC producer nations, which control about 40 percent of the world's oil exports, have been pumping at their highest levels in decades in an effort to cool prices.

Venezuela's oil minister said Wednesday the cartel has done all it can to boost oil supply, but global prices will probably hold at current levels.

Besides, British energy giant BP declared on Wednesday that its Schiehallion North Sea oilfield would be down until the end of the month as it repairs fire damage.

Unplanned closures and scheduled maintenance have cut around 10 percent of North Sea output in August.

BP said it had shut a unit at its Texas City refinery in the US, where refinery problems have pushed gasoline prices to historic highs.