Energy costs pushed higher as oil neared $100 per barrel in November. Gasoline, diesel fuel and home heating oil all showed big gains, Thursday, Dec. 13, 2007. (AP (file))
Singapore (AP) Oil prices have spiked above $103 a barrel for the first time ever amid a weak U.S. dollar and the prospect of still lower interest rates.
That combination has led to an infusion of cash into the oil market. Oil investors are taking more encouragement from Thursday's comments by Federal Reserve chairman Ben Bernanke, who indicates further interest rate reductions may be on the horizon. Lower interest rates tend to weaken the dollar. Oil futures offer investors a hedge against a falling dollar.
Light, sweet crude for April delivery jumped to a new trading record Friday of just over $103 a barrel in asian trading on the New York Mercantile Exchange before slipping back under the $103 mark.
One asian analyst predicts the oil market may soften at some point, but not likely in the near term.
Crude prices are now within the range of inflation-adjusted highs set in early 1980.