BBC NEWS | Business | Oil above $127 for the first time
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Oil prices have hit a record high above $127 a barrel on speculation that China will need to import more fuel, stretching global supplies.
With more energy needed to rebuild areas devastated by the earthquake earlier this week, US light sweet crude jumped to $127.43 a barrel.
Prices were also supported by
Goldman Sachs forecasting that oil would reach $141 a barrel later this year.
London Brent crude also climbed, touching $125.82 a barrel.
"Tight supply conditions continue to be the primary catalyst for higher crude prices," Goldman Sachs analysts said.
Pressure on Opec
Prices have risen by about 25% since the beginning of the year, lifted by geopolitical worries and the weakening US dollar, which makes oil cheaper for foreign buyers.
At the same time demand from fast-growing Asian economies, notably China, has exacerbated price pressures.