NEW YORK - Oil prices jumped above US$75 ($108) a barrel yesterday after a US hurricane forecaster predicted a busy end to the Atlantic storm season, raising concerns over potential disruptions to oil and gas production.
US crude settled up US$1.04 at US$75.08 per barrel, after trading as high as US$75.25. London Brent crude rose 51c to US$73.92 a barrel.
Hurricane Felix is battering Central America, sparing oil and gas installations in the Gulf of Mexico. But forecasters at Colorado State University said the rest of the 2007 Atlantic hurricane season would be busy, with a total of 15 named storms.
The US and Mexican oil sectors have escaped major storm damage so far this year but markets have remained on edge after hurricanes knocked out facilities in 2005.
Oil prices, closing in on the US record high of US$78.77 struck on August 1, also drew support from comments by some Opec members that the producer group is likely to maintain output levels when it meets next week.
"While the threat posed by Felix has receded, concerns over Opec's behaviour persist and are likely to intensify ahead of Opec's gathering next Tuesday," Barclays Capital said in a report.
But a source within Opec said yesterday the cartel could boost output by up to a million barrels a day later this year - when some analysts forecast supply could have trouble keeping up with demand.
"If things stay as they are, we need to increase by 500,000 to one million barrels per day," said the source, who declined to be identified. "Perhaps in December, depending on the stocks."
Opec kept output flat in August, according to a Reuters survey. The group agreed last year to cut output by 1.7 million barrels per day.
The only member suggesting the possibility of an imminent supply boost was Indonesia, Opec's second smallest producer.
"If current high prices are due to inadequate supply, then we will propose current production level increase," said Indonesia's Opec governor Maizar Rahman.
A Reuters poll of analysts forecast that US oil inventory data to be released by the government on Thursday would show crude stocks down 400,000 barrels, distillate stocks up a million barrels and petrol stocks off 1.5 million barrels.