The price of crude oil struck a record high 126.98 dollars a barrel on Tuesday despite expectations of slower demand growth for crude, traders said.
New York crude beat its all-time peak of 126.40 dollars, which was reached on Monday. The price of oil had fallen earlier Tuesday on profit-taking as the International Energy Agency cut its forecast for growth in global demand.
The Paris-based Internaional Energy Agency forecast in a monthly report that crude oil demand in 2008 would stand at 86.8 million barrels per day (bpd) --- some 390,000 bpd less than previous estimate given in April.
Oil prices have more than doubled in the past year and rocketed almost 25 percent since the start of 2008, when they blasted through the 100-dollar barrier.
Along with an inflow of investor funds, analysts have cited a variety of factors for this year's price spikes, including rising energy demand from Asian powerhouse economies China and India, and OPEC's refusal to pump more crude.
Prices were also moving in line with changes in the dollar but traders said that connection has weakened in recent weeks.
The US currency fell to a record low against the euro in April but has regained ground since then. A weaker US currency makes dollar-priced crude more affordable for holders of stronger currencies.
Analysts say the market is looking overbought as threatened disruptions to the Middle East supply have failed to materialise and as violent threats to output in Nigeria are increasingly priced in.
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