Sam Fletcher
Senior Writer

The June contract for US light, sweet crudes jumped to a record of $126.27/bbl May 9 on the New York Mercantile Exchange before closing at a record $125.96/bbl, gaining a total $9.64/bbl over five trading sessions that week.

North Sea Brent crude gained $10.84/bbl to $125.40/bbl that same week. Gasoline matched crude's gains on NYMEX, up $9.66/bbl to $3.20 gal. "But no one could come close to the weekly gains of heating oil at $17.64/bbl, [closing at a record $3.64/gal on May 9]" said Olivier Jakob at Petromatrix, Zug, Switzerland.

The price rally was fueled in part by evidence that Venezuelan President Hugo Chavez has aided rebels in the attempted overthrow of the government of Colombia. Investors fear Venezuela will cut off crude supplies to the US if the US government imposes sanctions against that country.

Market speculation
Many analysts attribute the oil-price surge to a general weakness of the US dollar against other key currencies and to the large amount of speculative funds invested into the commodities market. As a result, a bill is pending in the US Senate that would impose speculative-trading limits for West Texas Intermediate on the London markets, like those on the New York market.