Jumpy oil prices paused today after a rollercoaster ride that saw US crude brush $40 yesterday, with the looming prospect of war in Iraq underpinning the market amid heated debate at the UN.
Fears of war in oil exporter Iraq and a slump in already thin stocks of heating fuel during a harsh winter in the United States shot crude to $39.99 a barrel at one point yesterday. That was within range of a record high $41.15 struck in October 1990 after Iraq invaded Kuwait to prompt the Gulf War.
Prices were cooled by a heavy bout of profit-taking but remain up more than $6, or 20 per cent, since the start of the year amid fears a war could disrupt nearly two million barrels a day of exports - or more if it engulfs nearby producers.
Yesterday Washington ordered another aircraft carrier to sail to the Gulf region, pressing on with its preparations for war, as President George W. Bush brushed off Iraq's agreement to destroy banned missiles as part of "a campaign of deception".