Gold futures in New York surged above the historic $1,000 an ounce benchmark on Thursday, led by a combination of a weakening dollar, soaring crude oil prices and strong investment demand, prompting investors to enter the bullion market. Silver and platinum also gained.

Gold futures for April delivery climbed $13.30, or 1.4 percent, to close at $993.80 an ounce on the Comex division of the New York Mercantile Exchange. The price earlier reached $1,001.50, the highest ever for a most-active contract.

Gold jumped 31 percent last year as the dollar fell 9.5 percent against the euro and consumer costs accelerated at the fastest pace in 17 years.

Gold is traditionally denominated in U.S. dollars, although the currency stopped being backed by gold in 1971. The ongoing weakening of the dollar against other currencies of the world, particularly the yen and euro in recent days have caused investors to turn to the metal as an investment alternative.

However, gains in precious metals may make the commodities vulnerable to a sell-off should investors need to raise money to cover losses in equity markets, analysts say.

Given the profits earned by those who've been long, the propensity to sell their winning trades in order to defend their losers is very high,'' said Dennis Gartman, economist and editor of the Suffolk, Virginia-based Gartman Letter.

The dollar plunged below 100 yen for the first time in over a decade and hit a record low versus the euro as worries deepened on Wall Street that the US economy had entered a recession.

South Africa, the world's biggest precious-metals producer, reported an 11 percent drop in mining output in January, the most in at least a decade.

Gold output dropped 17 percent from a year earlier. World gold-mine production declined 1.4 percent last year to 2,444 metric tons, an 11-year low, according to researcher GFMS Ltd.

In energy trading, crude oil surged to another record on Thursday, boosting gold's appeal as a hedge against inflation. In early morning trading, U.S. crude futures hit an all-time high of $111 a barrel. Oil settled up 41 cents, closing at $110.33 a barrel.

Gold is not the only metal that has been shining more brightly of late. Silver futures for May delivery rose 42.5 cents, or 2.1 percent, to $20.42 an ounce. The metal reached $21.325 on March 6, the highest since October 1980.

The active NYMEX platinum contract for April delivery rose $27.50 or 1.3 percent to close at 2,097.50 an

ounce. Spot platinum fetched $2,098/2,108.