US crude oil prices came within cents of their record peak yesterday before slipping back, as worries over demand growth overshadowed rising stockpile levels in the United States.
Cold weather in the US northeast, the world's largest heating oil market, also helped support red-hot prices, which have surged more than 25 per cent since the start of the year.
US light crude for prompt-month April delivery on the New York Mercantile Exchange settled up 18 cents to $54.77 (€40.91) a barrel after climbing as high as $55.65, two cents below last autumn's all-time peak.
London's Brent crude rose 54 cents to $53.38 on the International Petroleum Exchange after hitting a record of $54.30 a barrel.
Prices rose despite US Energy Information Administration (EIA) data showing crude oil stocks were 3.2 million barrels greater last week at 302.6 million barrels - a fourth straight weekly rise and the biggest stockpile in eight months.
"The data is being overshadowed by macro factors - the weakness of the US dollar, the uptrend on the [technical] charts and OPEC [Organisation of Petroleum Exporting Countries] giving no indication it will produce more," said Jim Ritterbusch of Ritterbusch & Associates.
"There is no reason for the funds to part with their recent accumulations of long positions. It will take a lot more than one bearish inventory report," he added.
Strong demand growth from the US and Asia and lower-than-expected production from countries such as Russia have put pressure on world supply this year.
Spare capacity from OPEC producers is also considered tight.
The US EIA and the International Energy Agency have recently revised upward their global demand forecasts, including expected consumption from China, which is in second place among world energy users.
The price rally has also gathered pace as a steep decline in the dollar - the currency of international oil - spurred funds to switch money out of foreign exchange and into commodities such as energy, metals and coffee.
So far, there have been few concrete signs that high oil prices are denting economic growth.
