NEW YORK (Reuters) - Oil hit a fresh peak near $120 a barrel on Monday as supply outages in Nigeria and Britain shut down nearly 2 million barrels per day (bpd) of output in the Atlantic Basin.
U.S. crude settled up 23 cents at $118.75 a barrel after earlier hitting a record of $119.93. London Brent crude settled up 40 cents to settle at $116.74.
Crude prices have surged more than fivefold since 2002 and are up almost 25 percent since the start of the year as global supplies struggle to keep pace with rising demand in emerging economies, such as China.
“Continued attacks in Nigeria and refinery closures in Scotland ... may see the U.S. target $121-122 a barrel this week, with longer-term charts all pointing to $130 or higher,” said Ben Coleman, senior commodities trader at TradIndex.
A weak U.S. dollar has also attracted investors into commodities markets, analysts have said.
Exxon Mobil Corp (XOM.N) said on Monday it has had to shut nearly all of its Nigerian oil production, totaling around 770,000 barrels per day, due to a strike.
Niger Delta rebels, meanwhile, have said an April 24 pipeline attack had shut down a further 350,000 barrels per day of production by Royal Dutch Shell (RDSa.L).
A previous bombing raid had hit 169,000 bpd of Shell’s Nigeria output, the company said last week.
In Britain, the 700,000 bpd Forties North Sea crude oil pipeline remained closed on Monday due to a strike at the 210,000 bpd Grangemouth refinery over pensions.
Ineos, the owner of the Grangemouth refinery, expects striking employees to return to work on Tuesday. BP has said the Forties pipeline could then be back in operation within 24 hours but might take a few more days to get back to full flow.
The Nigeria and North Sea outages together represent more than 2 percent of world crude oil consumption.
The Organization of the Petroleum Exporting Countries (OPEC), which produces more than a third of the world’s oil, has refused to pump more, saying the market is adequately supplied.
OPEC President Chakib Khelil blamed high prices on the fall in the dollar and said he could not rule out prices rising to $200 a barrel.
“Without geopolitical problems and the fall in the dollar, the prices of oil would not be at this level,” he was quoted saying in Algerian government newspaper El Moudhajid.
Additional reporting by Fayen Wong in Perth, Richard Valdmanis in New York; editing by Matthew Lewis