Page last updated at 20:54 GMT, Wednesday, 16 April 2008 21:54 UK

Oil scales new record above $115

Oil traders on the floor of the New York Mercantile Exchange
The weakening US dollar is having a big effect on oil prices

The price of oil has hit a new record above $115 a barrel after a US government inventory report raised concerns about supplies.

US light, sweet crude oil rose to $115.07 before easing a touch to end New York trading at $114.93.

Meanwhile, Brent crude hit an all-time peak of $112.79 before falling back.

The weak dollar has helped to draw investors towards commodities, which are cheaper for foreign buyers because they are priced in the US currency.

US crude stocks fell 2.3 million barrels in the week to April 11 and petrol stocks fell by over 5 million barrels, the US Energy Information Administration reported.

A series of supply interruptions in the US, Mexico and Nigeria pushed oil above $114 for the first time on Tuesday.

'Key factor'

"The dominant factor continues to be the dollar and I expect this to continue for a while," said Gerard Rigby, an analyst at Sydney-based Fuel First Consulting.

"Whenever you get any kind of good economic news out of the (United States) at the moment, the dollar will rise and oil falls, and the other way round, you get a new oil record."

Producers' body Opec insists there is more than enough oil in the market and that prices are being forced up by broader economic worries, not specific supply concerns.

But recent problems in North America and Nigeria have acted to send prices upwards.

Shell's huge Capline pipeline that transports 1.2 million barrels of oil daily from the US Gulf Coast to the Midwest was closed over the weekend and is still operating below capacity.

Meanwhile Mexico, a key US supplier, was forced to close three oil terminals because of bad weather.

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