Oil rose above $130 a barrel for the first time after at least five banks raised price forecasts in the past week on expectations supply constraints will persist.
Crude oil for July delivery gained as much as $1.40, or 1.1 per cent, to $130.47 a barrel, the highest since trading began in 1983 on the New York Mercantile Exchange. It traded for $130.22 at 11.56am London time.
Oil prices are likely to carry on rising, futures prices show. Crude for delivery in December 2016 surged $17.08, or 14 per cent, in the three trading days after Goldman Sachs Group Inc. raised its forecast to $141 a barrel for the second half of the year.
Yesterday, Societe Generale SA and Credit Suisse raised their forecasts for prices.
"You see more money going into the back end of the curve," said Olivier Jakob, managing director of Petromatrix Gmbh in Zug, Swizterland.
"The issue is not the fundamentals. What's bullish is the comments from people like Goldman Sachs."
Brent crude oil for July settlement climbed as much as $2.08 cents, or 1.6 per cent, to reach a record $129.92 a barrel on London's ICE Futures Europe exchange.
The contract traded for $129.05 a barrel at 11.01am London time.
Bloomberg