LONDON (Reuters) – Oil sped to new peaks for a third straight day on Thursday to top $135 a barrel as investors fretted over long-term supply constraints and a big drop in U.S. crude stocks.
London Brent crude soared to an all-time high of $135.14. U.S. crude struck a record $135.09 and was trading $1.54 higher at $134.71 by 0954 GMT.
The latest leg of the rally began on Wednesday when oil leapt by more than $4 after U.S. weekly data showed crude stocks had declined by 5.4 million. Analysts had expected an increase.
“Yesterday’s EIA numbers set off this latest blast higher, but we suspect that prices would have gone up almost in spite of the numbers,” Edward Meir of MF Global said in a note.
“The market now has the technical feel of being in acceleration mode.”
Refined products, led by gas oil, also struck new records, driven by concerns about a lack of refining capacity and increased diesel demand.
China has stepped up imports of diesel to make up for power supplies lost in last week’s earthquake.
Concerns about long-term supply tightness have pushed prices for future delivery even higher than prompt contracts.
December 2016 U.S. crude reached $143.00.
The United States has repeatedly called on the Organization of the Petroleum Exporting Countries to increase its output to try to calm markets.
Leading OPEC producer Saudi Arabia last week said it had raised production by 300,000 barrels per day, but the news had minimal impact on the market.
While OPEC has blamed factors beyond its control for the record price rally, U.S. Energy Secretary Sam Bodman on Wednesday said the market reflected tight supplies and strong global oil demand.