NEW YORK, Aug 3 (AFP) - New York`s crude oil contract topped 44 dollars a barrel for the first time Tuesday in feverish trading after OPEC warned it cannot pump any faster.
The benchmark New York contract, light sweet crude for September delivery, shot to an all-time high of 44.24 dollars.
It settled at a record close of 44.15 dollars, up 33 cents from the previous day.
Brent North Sea crude for September surged 67 cents to 40.64 dollars a barrel, the highest closing level since October 1990 in the runup to the Gulf War.
Organization of Petroleum Exporting Countries (OPEC) president Purnomo Yusgiantoro, who is also Indonesia`s energy minister, sent a shiver through the market with comments in Jakarta.
"We can`t increase supply at this moment. Yesterday (Saudi Arabian Oil Minister) Ali al-Nuaimi said they could but they need time," Yusgiantoro said.
Current oil prices were "crazy," he said.
The OPEC chief also raised concerns over output from Russia`s largest oil producer, financially stricken Yukos, which is facing a titanic 3.4-billion-dollar tax bill from the Russian authorities.
"We`re worried (Yukos) won`t produce output if there`s a claim from the government," Yusgiantoro said.
OPEC ministers meet in September, Yusgiantoro said.
"There`s still an opportunity for prices to go down but this will depend on supply and demand" as well as the other factors, he said.
But market analysts said the rally may have further to go.
"There is a good chance prices could go higher," said Jamal Qureshi, analyst at PFC Energy Corp, citing the comments by OPEC and an attack on a major pipeline in Iraq.
Refco market analyst Marshall Steeves agreed.
"The speculative activity is such that, now the market is over 44 dollars it will probably shoot to 45 dollars," he said.
Terrorism fears kept prices bubbling, said Commerzbank analyst Jon Rigby in London.
"There is this terror alert in the US, which highlights the amount of political risk in the oil price. The fear of terrorism will always push the oil price up," he said.
In Iraq, an attack on the main pipeline connecting the oil fields of Kirkuk with the Turkish port of Ceyhan halted exports through northern Iraq, a Northern Oil company official said.
"An improvised explosive device was placed close to a network of pipelines at the level of Al-Fateha, west of Kirkuk, causing a big explosion and huge fires that damaged the main pipeline running to Ceyhan and stopped exports," Nasir Qassim, a logistics and security official with the company, told AFP.
OPEC agreed in June to raise its output ceiling by two million barrels per day in July and by a further 500,000 barrels from August 1.