April 22, 2008  From Bloomberg

April 22 (Bloomberg) -- Crude oil traded near a record above $117 a barrel in New York after attacks cut Nigerian output and the dollar dropped against the euro.

Royal Dutch Shell Plc said yesterday 169,000 barrels of oil a day was suspended because of attacks last week in Nigeria, Africa's largest oil producer. OPEC should help replenish oil inventories because prices are ``too high,'' International Energy Agency Executive Director Nobuo Tanaka said yesterday.

``We are clearly headed over $120 a barrel and we are targeting $125,'' said John Kilduff, vice president of risk management at MF Global Ltd. in New York. ``The last thing we need is another supply disruption. The outage certainly adds to the bullish sentiment.''

Crude oil for May delivery rose 2 cents to $117.50 a barrel at 8:17 a.m. Sydney time in after-hours electronic trading on the New York Mercantile Exchange. Yesterday, oil futures rose 79 cents to settle at $117.48 a barrel on Nymex, a record close.

Brent crude for June settlement rose 51 cents, or 0.5 percent, to settle at a record $114.43 a barrel on London's ICE Futures Europe exchange yesterday.

``This is a wild bull market,'' said Phil Flynn, a senior trader at Alaron Trading Corp. in Chicago. ``It's getting harder and harder to stand in the way of this. As long as the dollar is weak investors are going to buy oil as a hedge.''

Falling Dollar

The dollar fell to within a cent of a record low against the euro after European Central Bank officials reiterated concern inflation is accelerating, increasing chances interest rates will stay at a six-year high.

The dollar traded at $1.5909 per euro at 6:05 a.m. in Tokyo, after falling 0.6 percent yesterday. It touched $1.5983 on April 17, the lowest level since the European currency's 1999 debut. The euro traded at 164.25 yen, after increasing 0.2 percent. The dollar was at 103.24 yen, after falling 0.4 percent.

``If the dollar continues its slide, I can see prices go up,'' Iranian Oil Minister Gholamhossein Nozari told reporters yesterday in Rome. ``OPEC is supplying enough in the market. There are other factors keeping the oil price high.''

The Organization of Petroleum Exporting Countries produced 32.35 million barrels of crude a day in March, according to Bloomberg News estimates, and kept its production targets unchanged at its last three meetings.

Shell will declare a force majeure on exports of Bonny Light crude oil starting today as a result of the April 17 attack, spokesman Rainer Winzenried said in an e-mailed statement. Force majeure is a legal clause that allows companies to miss contracted deliveries because of circumstances beyond their control.

Nigeria produces low-sulfur oil prized by refiners because of the proportion of high-value gasoline it yields. It was the fifth-biggest source of U.S. oil imports last year, according to the Energy Department.

``The Nigerian barrels are some of the most valuable because of the gasoline they yield,'' Kilduff said.

Editor: Haijing Qu