Crude prices near record levels

Crude oil prices rose on Tuesday after speculators bet that demand will be higher than supplies even as refiners ramp up production.

Demand could increase by as much as 5.6 percent next year, according to some analysts, partly on extra use connected to the Beijing Summer Olympics, while more immediately Tokyo Electric Power (TYO: 9501) announced that it will double its oil purchases to around 180,000 barrels per day in order to compensate for lost power generation from its earthquake-damaged nuclear plant.

At the close of floor trade in New York, West Texas Intermediate crude September contracts were $1.37 higher to $78.20 per barrel, while September deliveries of Brent crude added $1.13 to $76.87 per barrel, taking prices to their highest level since a new record was set just about a year ago.

Nymex September gasoline, meanwhile, added 5 cents to $2.11 per gallon, while September heating oil was up 4 cents to $2.13 per gallon.

September natural gas was lower however, dropping 31 cents to $6.19 per million British thermal units.