Crude oil traded in London hit a record high of $74.22 a barrel on Thursday, the seventh consecutive day in which it set a new price peak.
Analysts are trying to work out when the recent price surge will peak
Concerns that rising demand for petrol will squeeze already stretched supplies have kept prices high, while data showed US gasoline stocks falling.
US-Iran tensions and Nigerian supply concerns are also driving the market.
Brent crude later eased to $73.18 while US light, sweet crude touched a record $72.49 before closing at $71.95.
News that an important oil platform damaged by Hurricane Katrina would recommence full production gave some relief to the market.
The Mars platform, operated by Royal Dutch Shell, has been running at reduced capacity since August.
The facility, which accounts for 5% of oil produced in the Gulf of Mexico, will return to pre-Katrina production levels in June.
But analysts said prices were likely to rise further as long as Iran's dispute with the international community over its nuclear intentions remained a potential flashpoint.
There are fears that oil exports from Iran - the world's fourth largest producer - could be disrupted if its dispute with the international community worsens.
"Besides the fundamental supply and demand information, prices are driven by the emotional momentum of the Iranian issue," said Victor Shum, from Singapore-based analysts Purvin & Gertz.
Iranian news agencies reported President Mahmoud Ahmadinejad as saying that the global oil price had yet to reach "its real value".
Oil producing and consuming nations are scheduled to meet in the Gulf state of Qatar at the weekend to try and find a way of stabilising soaring oil prices.
Ministers from 65 countries, including the US, the EU and the oil producers cartel OPEC will attend the Doha meeting of the International Energy Forum (IEF) from April 22 to 24.
Lower US stocks
A surprise fall in US gasoline supplies has worried analysts ahead of the peak summer holiday season.
Inventory stocks are currently running 5% lower than last year, after falling by more than five million barrels last week.
Consumers have done little to curb their thirst for petrol and diesel
Demand for gasoline is nearly 1% higher than this time last year, with 9.1 million barrels a day being drawn down.
Crude oil stocks also fell by 800,000 barrels a day, according to the latest figures, although stocks remain higher than this time last year.
"Healthy crude inventories have been keeping a lid on oil from rising further, but if we continue to see a drawdown in stock levels, that lid could come off," said Tony Nunan, manager of the risk management business at Mitsubishi Corporation.
This just underlines the pressing need for us to find alternative fuel sources for our cars. The Brazilian use of Ethanol is looking very encouraging, as is Biodiesel, but the most important thing we can do is to each start looking at ways of reducing our personal car use.
Richard Barker, Birmingham, UK
I watch all the SUVs and gas guzzlers on the road. All the wasted fuel, plus they are still running on petroleum based fuel. High prices will get people to conserve. I drive by the gas stations every day and have to chuckle....as it goes up. I do drive by...my car runs on veggie oil, carbon neutral and if I run low on straght veggie oil, I run on bio diesel.
Elizabeth Del, Williamstown, USA
Here in Chicago, gasoline prices have gone up 65 cents in the past 3 months. Every time I read something on the news about Iran (Venezuela, Nigeria), the gas prices go up. I think international politics, combined with the greed of big corporations drive up the gas prices.
B. Catalin, Chicago, USA
The world is being held to ransom by oil producing countries. Technology is available to produce much cleaner, more efficient and renewable fuels, such as ethanol, but for some reason governments are not trying to reduce its dependency on fossil fuels.
Paul Atkins, Brisbane, Australia
I'm no fan of Iranian President Mahmoud Ahmadinejad, but he is right that the global oil price has not reached "its real value". The thirst for gasoline of drivers in wealthy countries need to be quenched if the environment is to be respected, and higher oil price works for that worthy goal.
Richard Lozier, Moscow, Russia
Yet again they put the prices up on the one product that the whole world buys. This product just happens to be pretty much the only product not-available on the black-market. Governments all over the world make money from taxable sale, losing no revenue through illegal trade, lining the pockets of the oil barons. All that need to be are happy so no-one's going to rock the diesel-powered apple cart and start it running on 'apples' again.
Toby Rose, Manchester