Oil price soars to $140.05 per barrel

Oil has risen to a new record high as it surged to $140.05 per barrel during trading today.

Crude oil prices rose by 4.1% , achieving a new record high today as Libya threatened to cut production and the president of OPEC disclosed that prices may hit $170 per barrel this autumn.

Libya’s threat to cut oil exports is in response to a law in the USA that will allow victims of terrorist acts to seize the assets of governments suspected of sponsoring terrorism.

Libya, which produces around 2% of worldwide oil supplies, has not actually reduced it’s output yet, however the mere threat of production cuts has been sufficient to drive crude prices upwards.

This surge in oil prices, coupled with a 0.5% fall in the dollar, has exerted a strongly bearish effect on the US stock markets, with the Dow Jones Index falling to lows not seen since September 2005.