LONDON, Feb 29: Oil prices charted fresh record territory on Friday, rising to $103.05 as the dollar fell to all time lows, before profit-taking trimmed the gains, traders said.

A weak US currency boosts demand for dollar-denominated raw materials such as crude oil because it makes them cheaper for buyers using stronger currencies. The increased demand, if it outstrips the fall in the currency, leads to higher prices.

After striking a record high, New York’s main contract, light sweet crude for delivery in April, stood at $102.07 per barrel, down 52 cents from Thursday’s close.

Brent North Sea crude for April was at $100.40, down 50 cents. It struck a record peak of $101.27 on Thursday.

“There is good support to oil futures with the weak dollar, geopolitical tensions, fund interest and Opec’s (stance on) ... supplies,” said Sucden analyst Andrey Kryuchenkov.

“Nevertheless, persistent economic fears and more risk aversion could trigger a correction ... as investors still fear that slower growth in the US could weigh on global growth estimates and dent demand for energy,” he added.

Opec, which pumps 40 per cent of the world’s oil, was unlikely to change its production level at a meeting next week should crude prices remain around $100, acting Libyan Oil Minister Chukri Ghanem told AFP on Friday.

A weak US currency boosts demand for dollar-denominated raw materials such as crude oil because it makes them cheaper for buyers using stronger currencies. However the increased demand eventually leads to higher prices.

There is good support to oil futures with the weak dollar, geopolitical tensions, fund interest and Opec’s resilience to boost supplies, said Sucden analyst Andrey Kryuchenkov.

Nevertheless, persistent economic fears and more risk aversion could trigger a correction in rallying crude prices, as investors still fear that a slower growth in the US could weigh on global growth estimates and dent demand for energy, he added.

Opec, which pumps 40 per cent of the world’s oil, was unlikely to change its production level at a meeting next week should crude prices remain around $100, acting Libyan Oil Minister Chukri Ghanem told AFP on Friday.

Ghanem said of Wednesday’s Opec meeting that I think we won’t do anything if the price of oil remains around current levels.—AFP