Oil prices rallied to a record above $55 a barrel today on concerns over a winter fuel supply crunch and US comments indicating high prices have yet to really dent US demand.
US light, sweet crude oil futures hit a new peak at $55.33 a barrel, up 40 cents, for a gain of about 70 per cent on the start of the year.
US Federal Reserve chairman Mr Alan Greenspan warned on Friday of more serious consequences than the US economy has suffered so far if oil prices were to move much still higher.
However, he said "the impact of the current surge in oil prices, though noticeable, is likely to prove less consequential to economic growth and inflation than in the 1970s".
Some traders viewed his remark as a sign that higher oil prices have had little effect on demand so far, and with the global economy already having developed some momentum, the impact of price movements to date should be manageable.
Oil has jumped about $20 in less than four months, spurred most recently by an outage in US Gulf production, which is operating at 73 per cent of its normal rate of 1.7 million barrels per day (bpd) after pipeline and platform damage by Hurricane Ivan.
Some fields are expected to remain shut beyond the end of the year, the US government's resource agency said last week.
The shortfall has limited refiners' ability to build up US heating oil stocks, which at 50 million barrels are 10 per cent below last year, weekly government data showed last week.
US heating oil futures set a record at $1.5555 a gallon early today.