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NEW YORK: Oil prices declined on Thursday after soaring close to record highs in volatile trade stoked by concerns about stretched global energy supplies, traders said.
Prices did not appear to show too much reaction to an oil pipeline explosion in Nigeria, Africa's largest crude exporter, which according to the Red Cross killed about 100 people in a northern suburb of Lagos.
Militants regularly attempt to sabotage oil industry infrastructure in Nigeria's Delta region, but a Red Cross official said the pipeline blast appeared to have been caused accidentally by a road construction crew.
A government official had said earlier that 10 people had been killed as a result of the blast.
New York's main oil futures contract, light sweet crude for June delivery, dipped 10 cents to close at 124.12 dollars a barrel. The contract had earlier spiked to 126.64 dollars, which was not far off Tuesday's record high of 126.98.
In London, a benchmark Brent crude futures contract for June delivery settled 61 cents lower at 121.25 dollars.
Traders said lingering supply jitters, a weakened dollar and recent militant strikes in Nigeria were continuing to support oil prices.
Crude output from Nigeria has been slashed in recent years because of continuing militant attacks on energy facilities.
In Vienna, meanwhile, the Organisation of the Petroleum Exporting Countries (OPEC) trimmed its 2008 estimate of world oil demand growth, citing higher prices and slower economic momentum in major industrialised countries including the United States.
Global oil demand was projected to grow by 1.35 percent in 2008, compared with a previous estimate of 1.4 percent, OPEC said in a monthly survey.
"World oil demand growth in 2008 is forecast at 1.2 million barrels per day (bpd) to average 86.95 million bpd, representing a minor downward revision from last month," the crude producers' cartel said.
Oil prices have surged since crashing through the 100-dollar-a-barrel barrier at the start of the year, but some analysts argue that prices have surged to unsustainable heights.
Other analysts, however, have started discussing the possibility of oil prices eventually hitting 200 dollars.
OPEC, which pumps about 40 percent of world oil supplies, has repeatedly insisted that the world market is well-supplied and that price spikes have been caused by speculators.
British Prime Minister Gordon Brown called again for OPEC to ramp up output and help bring down red-hot oil prices that are helping fuel inflation around the world.
"I would want OPEC to consider increasing production, I believe there is capacity to do so," Brown said on Thursday.
US President George W. Bush has also made similar calls in recent months.
The OPEC report followed the release of an International Energy Agency survey on Tuesday which suggested growth in global oil demand will slow.
The IEA, an energy policy adviser to major industrialised countries, predicted that crude demand in 2008 would stand at 86.8 million barrels per day (bpd) - about 390,000 bpd less than its previous estimate given in April. - AFP/de
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