$100-a-barrel mark breached; Weak dollar, speculation, unrest in oil-producing countries among set of factors blamed
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  • rude Oil prices (light sweet crude) finally breached the US $100 a barrel mark after gaining $4.02 in New York1. Analysts noted that a set of factors including increased violence in oil-producing countries such as Nigeria and Algeria, assassination of Benazir Bhutto and the unrest which followed in Pakistan, along with a weak dollar, contributed to the spurt in the rise.

    While the spike became a cause of much concern and analyses, analysts like Tim Evans of Citigroup Financial saw the hype as being “frivolous”. Reports also noted that the high prices were in part due to speculation activities as the market continued to be well supplied, a view affirmed by the Organisation of Petroleum Exporting Countries (OPEC). In a related development, White House spokesperson Dana Perrino stated that the American Strategic Petroleum Reserves would not be used to bring down prices.

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