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Oil sets -- you guessed it -- record high

Associated Press

Last update: May 7, 2008 - 9:04 PM

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NEW YORK - Oil futures extended their seemingly relentless advance Wednesday to a new trading record near $124 a barrel, as investors captivated by the market's momentum looked past the government's report of an increase in crude and gasoline supplies.

At the pump, gasoline prices rose for the first time since last week.

Light, sweet crude for June delivery hit a new trading record of $123.90 in after-hours activity on the New York Mercantile Exchange after settling up $1.69 at a record close of $123.53 a barrel.

Analysts attributed oil's rise to continued buying from the surge this week that pushed prices past $120 for the first time. The fact that prices didn't decline sharply after the inventory report was released signaled to some investors that the market was ripe for another rally.

Wall Street slid amid worries about the effects of rising prices. Treasury Secretary Henry Paulson said Wednesday that, while the worst of the credit crisis might have passed, rising gasoline prices will dampen the benefits from the economic stimulus checks that the government is distributing.

The Dow fell 206.48, or 1.59 percent, to 12,814.35, after fluctuating early in the session. Broader stock indicators also declined. The S&P 500 fell 25.69, or 1.81 percent, to 1,392.57, and the Nasdaq composite index fell 44.82, or 1.80 percent, to 2,438.49.

At the pump, meanwhile, the average national price of a gallon of regular gasoline rose for the first time since last week, adding 0.8 of a cent, to almost $3.62, according to a survey of stations by AAA and the Oil Price Information Service.

ASSOCIATED PRESS

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