Guardian Unlimited- Oil surged to a record high above $103 on Friday as supply disruption fears and the dollar’s fall to three-year lows against the yen prompted funds to pile into commodities, lifting gold and palm oil to historic highs.
Base metals hovered near 21-month peaks, but wheat fell more than 2 percent in Asia, extending a plunge that began the previous day after unauthorised trades by a dealer prompted broker MF Global to set aside $141.5 million to cover losses.
"Hedge funds are taking advantage of the very weak dollar, but the fundamentals are very poor," said Makoto Takeda of Tokyo’s Bansei Securities.
U.S. crude hit a high of $103.05 in early trade, smashing the inflation-adjusted high of $102.53 reached in 1980, a year after the Iranian revolution, but later shed initital gains, falling 4 cents to $102.55 a barrel by 0344 GMT.
The Trans-Ecuadorean pipeline, which pumps most of the oil extracted by Petroecuador in the Amazon jungle to ports on the Pacific Ocean, was shut after a landslide punctured it.
