OPEC oil prices hit record high

Daily average oil prices of the Organization of Petroleum Exporting Countries (OPEC) rose by 1.08 U.S. dollars to a record 74.21 dollars per barrel Wednesday, 0.54 dollars higher than the previous high on July 20, the cartel's secretariat said Thursday.

The rise shows that OPEC's decision to increase daily output by 500,000 barrels starting from Nov. 1 at its 145th ministerial conference in Vienna Tuesday is not enough to restrain soaring oil prices.

But Hasan Qabazard, director of OPEC's research division, said here Thursday that the hurricane impact on oil production in the Gulf of Mexico and the Mexican oil pipeline blasts had caused oil prices to soar.

The rising prices were also compensating for the current weakness in the dollar, he said, but adding that if calculated in euros, the price - slightly over 50 euros per barrel - would still be around 10 per cent below last year's all time high.

He believed that the current crude oil supply in the world market was sufficient, while the shortage of the refinery capability would last many years.

Market analysts, however, believed that because of the recent unexpected reduction in crude oil stocks in the United States, OPEC's 500,000-barrel-a-day increase would not stabilize oil prices, only worsen the worry about the shortage of supply in the market.

They warned that with the upcoming demand peak for heating oil in winter in the Northern Hemisphere, the rising speculation would mean oil prices would continue to increase in the near future.