Crude oil price likely to hit peak

For those who want to think that current prices are not an issue because of
inflation.

<http://www.ft.com/cms/s/0/4a94260e-8593-11dc-8170-0000779fd2ac.html?nclick_check=1>

Crude oil prices appear increasingly likely to hit a record in real terms
reached during the second oil crisis in 1979, as nominal prices on Monday
continued rising well above $90 a barrel.

Intermediate crude hit a fresh nominal all-time high of $93.20 a barrel on
Monday on a combination of renewed geopolitical tension over Iran's nuclear
programme, weakness of the US dollar and low inventories.

The price leap came after Mexico said it was shutting about 600,000 barrels
a day of oil output, or 20 per cent of its total, due to bad weather in the
Gulf of Mexico. Authorities hope to restore output in the near term as the
cold weather front moves away from the production and terminal areas.

WTI moved $1.34 higher in early trading on Monday to a fresh nominal
all-time high of $93.20 a barrel. It later pared gains to traded$1.03 higher
at $92.89. Brent crude oil also continued upwards, hitting for the first
time the $90-a-barrel key level, before easing back to stand $1.15 higher at
$89.84 a barrel.

Barclays Capital's technical analyst said: "The bull channels keep our focus
higher towards $93.45, with little standing in the way of $100 above there."

In real terms, adjusted for inflation, oil is at its highest price since the
early 1980s but still below its modern historical peak - equivalent to about
$100-$110 a barrel in today's money - reached in late 1979 after the Iranian
revolution.

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