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Oil hits new record near $127 on Iran threat
Oil bounced back on Tuesday to a record high near $127 a barrel after reports of Iran threatening to cut output.
US crude settled $1.57 to $125.80 a barrel, after striking a record $126.98 earlier. London Brent crude raised $1.19 to $124.10 a barrel.
Earlier, Iran President Ahmadinejad said a proposal to reduce Iran's crude output was being reviewed by experts.
''There has been such a proposal and it is under expert review,'' as saying when asked about the possibility of the world's number 4 producer reducing output.
Oil prices have already surged six fold since 2002 as supply has struggled to keep pace with booming demand from emerging economies.
Further support came from tight global supplies of distillate fuels such as diesel after a snag at the Grangemouth refinery in Scotland.
Oil had closed lower on Monday after data showed a decline in oil imports by number 2 consumer China in April, the first year-on-year drop in 18 months, raising further questions about demand growth forecasts.
The International Energy Agency said record-high oil prices would slow global oil demand growth this year to 1.03 million barrels per day, 230,000 bpd less than its previous forecast. Demand from emerging countries remained strong, however.
Consumer nations have called on OPEC to ramp up production to help ease the sting of high fuel prices, but officials from the cartel insist that speculators - not a lack of supply - are responsible for surging prices.
Oil bounced back on Tuesday to a record high near $127 a barrel after reports of Iran threatening to cut output.
US crude settled $1.57 to $125.80 a barrel, after striking a record $126.98 earlier. London Brent crude raised $1.19 to $124.10 a barrel.
Earlier, Iran President Ahmadinejad said a proposal to reduce Iran's crude output was being reviewed by experts.
''There has been such a proposal and it is under expert review,'' as saying when asked about the possibility of the world's number 4 producer reducing output.
Oil prices have already surged six fold since 2002 as supply has struggled to keep pace with booming demand from emerging economies.
Further support came from tight global supplies of distillate fuels such as diesel after a snag at the Grangemouth refinery in Scotland.
Oil had closed lower on Monday after data showed a decline in oil imports by number 2 consumer China in April, the first year-on-year drop in 18 months, raising further questions about demand growth forecasts.
The International Energy Agency said record-high oil prices would slow global oil demand growth this year to 1.03 million barrels per day, 230,000 bpd less than its previous forecast. Demand from emerging countries remained strong, however.
Consumer nations have called on OPEC to ramp up production to help ease the sting of high fuel prices, but officials from the cartel insist that speculators - not a lack of supply - are responsible for surging prices.
