Crude Oil Nears $100

By JAY FITZGERALD

Oil prices hit yet another record yesterday, soaring above $92 a barrel as analysts warned that the once unthinkable $100 mark is now possible – and that consumers will pay for it in the end.

Yesterday’s frenzied trading for crude oil came amid worries about events in Iraq and new U.S. sanctions slapped on Iran, one of the world’s biggest oil producers.

But analysts said there’s no doubt speculators are also driving up prices – and $100 a barrel is now in sight.

“There’s nothing out there to stop oil from going to $100,” said Chip Hodge, a managing director at MFC Global Investment Management in Boston.

“There’s no reason why it wouldn’t” hit $100, agreed Peter Beutel, an analyst at Cameron Hanover in Connecticut, noting demand for oil across the world is still strong.

The price of crude oil has been rising fast in recent weeks, helping drive up home heating-oil prices in the process.

But, somewhat surprisingly to industry watchers, the price of gasoline hasn’t climbed as sharply.

Nationally, the average price for a gallon of regular gas has barely budged in the past month, rising only a penny, according to AAA.

In Massachusetts, the price has risen only 4 cents over the past month, to $2.71 a gallon, according to AAA Southern New England.

Terri Campbell, a portfolio manager at Boston’s Eastern Bank, said the reason for the small rise in gas prices could be that speculators aren’t focused on the wholesale-gasoline market, as they are on the crude-oil markets.

But Beutel said it’s only a matter of time before gas prices start to rise substantially in response to skyrocketing crude prices.

Herald wire services contributed to this report.

Originally published by By JAY FITZGERALD.

(c) 2007 Boston Herald. Provided by ProQuest Information and Learning. All rights Reserved.