High-flying oil climbed back over $50 a barrel this evening, with worries over the security of Nigerian supply supporting prices despite a surprise build in US crude inventories.
US light crude traded as high as $50.10 a barrel, less than 40 cents off Tuesday's all-time record of $50.47, before falling back to just under $50. London's Brent crude was 62 cents up at $46.70.
A Nigerian rebel group's threat to launch all-out war against the government in the oil-rich delta region has kept prices boiling this week.
Mujahid Dokubo-Asari's Niger Delta People's Volunteer Force agreed a truce after talks in capital Abuja yesterday, helping the market unravel some of its gains.
Analysts said fears still remained over the security of Nigeria's more than two million barrels per day of crude. Peace talks continued in Abuja today, but main producer Shell said it had withdrawn more workers from the troubled region.
Fears for a disruption to world supply capacity, tightly stretched to accomodate the fastest demand growth in a generation, have underpinned more than 53% gains on crude prices so far this year.
Data from the US government Energy Information Administration yesterday showed a surprise build on crude stocks, which had been expected to fall as a result of hurricane disruption in the Gulf of Mexico.
The weekly inventory snapshot showed stocks of distillate fuels, including key supplies of heating oil, fell 1.3 million barrels to nearly five million barrels below year-ago levels.
The US government says nearly 29% of Gulf of Mexico daily output is still shut in after Hurricane Ivan.
