Oil hits record $122 on $200 oil prediction, supply concerns
NEW YORK (AP) -- Oil futures blasted to a new record of $122 a barrel
Tuesday, gaining momentum as investors bought on a forecast of much
higher prices and on any news hinting at supply shortages. Retail gas
prices edged lower, but appear poised to rise to new records of their
own in coming weeks.
A new Goldman Sachs prediction that oil prices could rise to $150 to
$200 within two years seemed to motivate much of Tuesday's buying,
although a falling dollar and increasing concerns about declining
crude production in Mexico and Russia contributed, analysts say.
Light, sweet crude for June delivery jumped to a new record of $122 a
barrel before retreating slightly to trade up $1.92 at $121.89 on the
New York Mercantile Exchange.
Oil prices have nearly doubled from about $62 a barrel a year ago,
which Goldman sees as a sign that the world is in the midst of a
"super spike" in oil prices. Analyst Arjun Murti said in a research
note released Monday that prices would ultimately force demand to fall
sharply.
"You're going to see new highs for gas prices, probably for the
weekend," said Cordier, who predicts an average price of $4 a gallon
in the coming weeks.
In other Nymex trading Tuesday, June gasoline futures rose 5.24 cents
to $3.1053 a gallon after earlier setting a new trading record of
$3.1163. June heating oil futures rose 4.05 cents to $3.347 a gallon,
and June natural gas futures rose 16.4 cents to $11.342 per 1,000
cubic feet.
In London, June Brent crude futures rose $2.30 to $120.29 on the ICE
Futures exchange
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