Oil prices close in on record 130 dollars

LONDON (AFP) — Oil prices headed towards a record high of 130 dollars a barrel on Wednesday on anxiety about stretched supplies in the face of strong demand for energy, analysts said.

New York's main oil futures contract, light sweet crude for July delivery, rose 35 cents to 129.33 dollars a barrel. On Tuesday it reached an all-time high of 129.60 dollars.

London's Brent crude contract for July showed a gain of 46 cents to 128.30 dollars a barrel on Wednesday after spiking to a record summit of 128.53 dollars earlier in the day.

The market was awaiting the latest weekly snapshot of energy inventories in the United States -- the world's biggest consumer of oil -- to be published by US government on Wednesday.

Tony Nunan, of Mitsubishi Corp.'s international petroleum business, said that concerns over supplies not keeping up with demand were driving prices higher.

"The market is technically and fund-driven right now," he said on Wednesday, referring to investors buying into oil in hopes for higher returns.

David Moore, a commodity strategist at the Commonwealth Bank of Australia, said a weaker US dollar and "the recent trend for analysts to revise higher their oil price forecasts" are helping to push up prices.

Moore added there were reports that the need for diesel-fuelled power generation in earthquake-affected areas of China was boosting demand for the fuel.