Crude futures soared above $142 a barrel on Friday following a steep decline on U.S. stock markets that triggered investments into the commodity sector.
U.S. stocks tumbled on Friday as oil piled gains and Moody's Investors Service said it is likely to cut Morgan Stanley's credit rating. On Thursday, the Dow Jones index had its second-biggest percentage decline of the year.
Earlier today, the Dow industrial average fell after investors feared higher prices of crude and further damage on the financial sector due to credit losses.
Supporting prices, yesterday the president of the Organization of Petroleum Exporting Countries which is responsible for 40 percent of global oil production, speculated oil may rise as high as $150 and $170 a barrel in few months.
Crude oil futures for delivery in August were trading $1.09 or 0.78 percent up at $140.73 a barrel by 2:53 p.m. on the New York Mercantile Exchange. On Friday, prices rose above $142 a barrel for the first time to $142.99 a barrel in New York.
Oil's increase of 46 percent this year resulted mainly from the dollar's weakness which has prompted investors to store their money into commodities as they compensate for inflation. But prices had been lifted also by demand concerns from fast growing economies and political tensions that have disrupted production on top oil exporters such as Nigeria and countries in the Middle East.
Brent crude futures for delivery in three months climbed 82 cents or 0.59 percent to $140.08 a barrel in the London ICE Futures exchange.
Following the decline on stocks, the U.S. currency posted losses against the euro and the yen today.