Oil sets new record at $147 per barrel

Oil prices set a new record near $147 a barrel yesterday, boosted by concerns over possible disruption of tight global supplies amid tensions over Iran's launch of test missiles and the threatened renewal of oil-related violence in Nigeria.

By the afternoon in Europe, light, sweet crude for August delivery was up $4.93 on the day at $146.58 a barrel in electronic trading on the New York Mercantile Exchange. Earlier in the session, it hit a new trading high of $146.90 before retreating.

The contract rose $5.60 in the overnight floor session to $141.65 a barrel – after losing nearly $10 on Monday and Tuesday and then gaining a penny on Wednesday.

In London, August Brent crude was up $4.84 to $146.47 a barrel on the ICE Futures exchange. The contract rose as high as $147.25 yesterday.

"There's always a fear premium in pricing. The tensions in Iran and the threat of supply disruption will help support oil prices," said Jeff Brown, managing director of FACTS Global Energy in Singapore.

A day after Iran tested a missile capable of reaching Israel, the US warned Iran. Tehran then responded with another missile launch.