Crude oil prices remained in record territory after soaring to new highs Friday past US$66 a barrel as reports of new U.S. refinery outages rekindled fears that gasoline supplies in the world's biggest consumer would struggle to meet rising demand.
A spate of refinery glitches, an unusually active hurricane season in the U.S. and concerns over Iran's decision to resume uranium conversion activities weighed heavily on people's minds, pushing prices upward, analysts said.
Tropical Storm Irene was expected to intensify Friday and possibly reach hurricane strength as it approached the U.S. East Coast, forecasters said.
Irene's potential threat to land was still uncertain, as its path had shifted east, according to forecasters at the National Hurricane Center in Miami. Forecasters said the storm could strike the coast anywhere from South Carolina to New Jersey.
With bullish sentiment unabated and crude prices hitting consecutive highs this week, analysts expect front-month crude contracts to test the US$70 a barrel threshold.
Light, sweet crude for September delivery gained 23 cents to US$66.03 on the New York Mercantile Exchange, after hitting a new record high at US$66.15 a barrel in earlier trading.
Gasoline was marginally down at US$1.9480 a gallon (3.8 liters) while heating oil was down nearly a cent at US$1.8904.
In London, Brent crude for September delivery was trading at US$65.69 a barrel, up 31 cents.
Analysts said gasoline demand, currently at its peak in the U.S. summer driving season, was driving crude's gains. Last week, U.S. gasoline demand picked up by 1.4 percent from a year ago, according to government data, informs The AP.
According to Forbes, there's not too many reasons to sell oil and many reasons to buy it,' said David Thurtell, a commodities strategist at Commonwealth Bank of Australia in Sydney.
Global oil markets have surged this week because of huge speculative buying, sky-high global demand and shutdowns at strained US refineries, dealers said.
'The petrol and gasoline situation in the US is probably the most worrying factor at the moment, and it looks like it could be an ongoing problem because a shortage of refining capacity is not something that can be solved very quickly,' said Global Insight energy analyst Simon Wardell in London.
The Department of Energy surprised the market in a weekly report Wednesday that showed US gasoline, or petrol, inventories fell by 2.1 mln barrels in the week to August 5.
Crude reserves jumped by 2.8 mln barrels while stockpiles of distillate products, which include heating oil, rose by 2.6 mln barrels.