Oil climbed above $66 a barrel today as a gathering Caribbean storm posed a new threat to output.
Supply disruptions in Iraq, Nigeria, the North Sea and Ecuador have driven oil back towards its $67.10 a barrel record and added to concerns that stocks are running low.
Today, traders watched the beginnings of two tropical storms that could hit oilfields in the US Gulf.
As Iran's parliament prepared to vote on the country's next oil minister, the market was reminded that Opec's second biggest producer is at odds with the West over its nuclear programme. US crude traded 58 cents higher at $66.29 a barrel just after midday today. London Brent was up 49 cents at $65.14.
Assurances by top exporter Saudi Arabia that it would pump as much oil as its customers need failed to take the sting out of a rally that has lifted oil towards the inflation-adjusted $82 a barrel of 1980, the year after the Iranian revolution.
The perceived vulnerability of supply lines is a major factor supporting prices.
Crude oil exports from Iraq's southern Basra terminal resumed late yesterday after a power cut earlier in the day, which had halted crude loadings of around 1.5 million barrels per day (bpd), shipping sources said.
In Ecuador, which mostly supplies crude to California, output is still down to around 80 per cent of its 530,000-bpd level after attacks on oil infrastructure last week.
Traders were also watching for any disruption in Nigeria, the world's eighth-largest crude exporter, after the state-pricing agency instructed the national oil company to recover costs on sales, implying consumer prices are set to rise dramatically. Previous fuel hikes have led to general strikes.
With some production in the UK North Sea and India already offline, dealers worry that Opec is pumping flat out and would strain to make up any unexpected outages.