Crude oil futures reach record high

LONDON -- Crude oil futures Wednesday jumped to a new record high, riding upward on continuing concern about threats to supplies from Iraq and Russia.\nU.S. light crude for September delivery briefly hit an intraday high of $44.30 a barrel in electronic pre-session trading on the New York Mercantile Exchange. That price was the highest on record since oil futures began trading on the Nymex 21 years ago.\nThe price later fell to $44.29 in midday trading Wednesday. That was 14 cents above Tuesday's settlement of $44.15, which had set a closing price record.\nOn London's International Petroleum Exchange, September Brent crude futures rose to an all-time intraday high of $40.97, up 33 cents from Tuesday's record settlement price of $40.64. The previous all-time high intraday price was $40.95 set in October 1990. The IPE launched Brent crude futures in June 1988.\nOil prices have risen partly because of concerns about the reliability of crude supplies from Iraq, where saboteurs have attacked pipelines and disrupted exports and because of fears of terrorist attacks in the United States. U.S. authorities warned Sunday that al-Qaida was planning attacks on five key financial institutions in New York, New Jersey and Washington, D.C.\nUncertainty about the fate of Russia's largest oil company Yukos continued to unnerve markets. Russian tax authorities said Monday they would begin investigating the 2002 activities of Yukos, which produces 2 percent of the world's crude.\nSome analysts have forecast that the oil price could rise to $50 a barrel and that the Organization of Petroleum Exporting Countries will not be able to meet demand in the fourth quarter.\nOil analyst Richard Griffiths, at brokerage Williams de Broe, said such a rise was feasible, but only if there was a major disruption to oil supplies coupled with evidence of renewed strength in demand.\nGriffiths said, however, that limits on output capacity for the world's leading producers would cool down significantly in the foreseeable future.\n"I doubt there is a quick fix," Griffiths said, adding that OPEC countries would need more investment and time to reach higher production levels.\nJohn Vautrain, vice president of Houston-headquartered energy consultants Purvin & Gertz, agreed that prices could reach $50.\n"If you want the prices to come down, there probably needs to be a reduction in the (terror) threats. Let's quiet down Iraq, let's get Yukos settled," Vautrain said in Singapore.\n"Clearly the world is very nervous. Clearly New York is very nervous over the variety of events in the past weeks," he said. "Most of it is nerves and not an issue of supply."\nTuesday, OPEC President Purnomo Yusgiantoro said the cartel could not immediately increase output to help bring prices down. But Dow Jones Newswires later quoted a senior Saudi source as saying Saudi Arabia had the capacity to "immediately" increase its oil output from 9.5 million barrels a day to 10.5 million barrels a day.\nTraders say they are awaiting the U.S. Department of Energy's weekly oil data report, due later Wednesday, for further clues on the short-term outlook.\nOne trader, speaking on condition of anonymity, said prices will cool once the "wave of Saudi crude" hits the market, which he said would happen soon.