The price of oil eased a little after its meteoric rise on Friday when it hit $139 a barrel.Warning of a global recession, consumer nations are urging an increase in production.
Some analysts warn that crude could soon hit 150 dollars a barrel. Howard Wheeldon is senior strategist at BGC Partners: “I imagine that it will hit 150 dollars a barrel and when it does it will actually bounce back the other way. We may well sit at a level of 120-130 dollars a barrel for a little while. Ultimately, in the long term, the oil price will continue to rise.”
Crude oil prices surged in reaction to a new decline in the US dollar after the European Central Bank signalled a possible interest rate hike and the US reported a sharp rise in unemployment on Friday.
Meeting in Japan over the weekend, ministers from the G-8 industrialised nations expressed concern about price rises. They called for increased investment in new technology and alternative power sources.
Record petrol prices are causing consumers to cut back on fuel purchases. In the US demand for petrol fell recently almost five percent from a year earlier. This is seen as a sign motorists are cutting consumption because of sky high prices at the petrol pump.