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Oil surge closes over $80 for first time - extended

US crude oil prices closed over $80 a barrel for the first time Thursday after flirting with the record for several days. OPEC oil prices hit record high. Oil prices fall below $80 in early trading on Friday.

US crude oil prices fell from all-time high closing figures to less than $80 a barrel in early electronic trading Friday at the New York Mercantile Exchange. 

Sweet crude for October delivery added 18 cents to finish at $80.09 a barrel at the New York Mercantile Exchange. The price had hit $80.15 during the session and $80.20 during the earlier electronic trading. But, it was the first closing in what one investor called “uncharted territory.” Oil had topped $80 during Wednesday’s session but closed a few cents short. Concerns over falling supplies had bothered investors for several days.

Natural gas prices dropped 6% after a storm threat in the Gulf of Mexico fizzled. Natural gas closed down 40.9 cents at $6.029 per million British thermal units. Heating oil was up 3.64 cents at $2.016 a gallon and reformulated gas was up 3.49 cents at $2.016 a gallon. The average price of a gallon of unleaded regular gasoline at the pump was $2.808, down from Wednesday’s $2.815, the AAA said.

Daily average oil prices of the OPEC rose by $1.08 to a record $74.21 per barrel Wednesday, $0.54 higher than the previous high on July 20, the cartel’s secretariat said Thursday. The rise shows that OPEC’s decision to increase daily output by 500,000 barrels starting from Nov. 1 at its 145th ministerial conference in Vienna Tuesday is not enough to restrain soaring oil prices. But Hasan Qabazard, director of OPEC’s research division, said here Thursday that the hurricane impact on oil production in the Gulf of Mexico and the Mexican oil pipeline blasts had caused oil prices to soar. The rising prices were also compensating for the current weakness in the dollar, he said, but adding that if calculated in euros, the price - slightly over €50 per barrel - would still be around 10% below last year’s all time high. He believed that the current crude oil supply in the world market was sufficient, while the shortage of the refinery capability would last many years.

Market analysts, however, believed that because of the recent unexpected reduction in crude oil stocks in the US, OPEC’s 500,000-barrel-a-day increase would not stabilize oil prices, only worsen the worry about the shortage of supply in the market. They warned that with the upcoming demand peak for heating oil in winter in the Northern Hemisphere, the rising speculation would mean oil prices would continue to increase in the near future. (m&,