The price of oil reached a record $50.99 during trading
Tuesday, Oct. 5, on the New York Mercantile Exchange.
Media outlets and analysts attributed the increase to
reduced U.S. output, a drop caused by damage to production facilities in the
Gulf of Mexico in the wake of several hurricanes.
The price of crude oil closed above $50 a barrel for the
first time Friday, Oct. 1. The price has been pushed up recently by a
combination of factors – in addition to the hurricane activity – ranging from
unrest in oil-producing Nigeria and increased demand from China to damage to
oil facilities from insurgent attacks in Iraq.
Meanwhile, the federal government lent refiners 4.2 million
barrels of oil from the nation’s Strategic Petroleum Reserve to make up for the
drop in production caused by Hurricane Ivan. However, analysts doubted that the
release would be enough to affect prices.
"It's certainly not going to make up for what we've
lost in production," Tom Bentz of BNP Paribas Futures in New York told The Associated Press.
Diesel prices have followed oil into unknown territory, with
the average price in every region of the United States exceeding $2 a gallon,
the Department of Energy reported. The national average price was $2.053, with
the highest price – as usual – in California, at $2.29 per gallon.