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Oil cracks $100 a barrel

Oil cracks $100 a barrel

Hong Kong: Crude oil rose to $100 a barrel for the first time in New York briefly yesterday as record global fuel consumption threatens to outpace production.
Oil's gain, extending last year's 57 percent rally, was boosted by forecasts that U.S. stockpiles dropped to a three-year low last week. Unrest in Nigeria, Africa's largest oil producer, also spurred prices.
Three-figure prices may bring energy costs near the tipping point that will cause global economic growth to falter, Bloomberg warned. China has more than doubled oil use since New York crude dropped to this century's low of $16.70 a barrel on November 19, 2001. That's soaked up most of the world's spare production capacity amid supply cuts in Nigeria, Iraq and Venezuela.
Crude oil for February delivery rose $4.02, or 4.2 percent, to $100 a barrel at 12:10 p.m. on the New York Mercantile Exchange, the highest since trading began in 1983. The exchange confirmed that there was one floor trade at $100. Prices jumped $3.64, or 3.8 percent, to settle at $99.62 a barrel at 2:53 p.m., a record close.
''What brought us here is still with us,'' said Harry Tchilinguirian, an analyst at BNP Paribas SA in London. ''The dynamic of strong winter demand, declining consumer country inventories, and geopolitical tension against a backdrop of tight spare capacity are all kept in place.''  [03/01/08]

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