Oil fell to $102 a barrel today, stepping back from a record high reached due to supply disruptions and as a weak dollar encouraged investors to buy commodities.
The latest jump, which sent US crude above the inflation-adjusted high of $102.53 hit in 1980, followed the shutdown of an oil pipeline in Ecuador and a fire at a European natural gas plant.
"Some profit taking could lead to lower prices today," said Frank Schallenberger, analyst at Landesbank Baden-Wurttemberg in Stuttgart, Germany.
US crude was down 59 cents at $102.00 a barrel by 1.22pm after hitting a record $103.05 earlier in the session. London Brent crude dropped 64 cents to $100.26, off its record high of $101.27.
The Trans-Ecuadorean pipeline, which pumps most of the oil extracted by Petroecuador in the Amazon forest to ports on the Pacific Ocean, was shut after a landslide punctured it.
State oil firm Petroecuador initially said it would declare force majeure on shipments from the pipeline, but shortly after reversed the decision, saying it would bypass the damage or use a private pipeline.
Ecuador is OPEC's smallest producer, pumping 500,000 barrels per day, The pipeline was handling around 150,000 bpd.
Oil surged yesterday after a fire at the Bacton Gas Shell terminal in Norfolk, England, shut more than 45 million cubic metres per day of gas supplies, about 13 per cent of the UK national grid's forecast demand.
Shell said the fire had been extinguished and the plant had been shut down safely. It remained shut today.
Some analysts say the plunging dollar, which hit an all-time low on Friday against the euro, has encouraged investors to pour money into commodities as a hedge against inflation.
Also adding support, the Organization of the Petroleum Exporting Countries is unlikely raise oil output at a meeting on March 5th, rebuffing a call from top consumer the United States for more supply.