LONDON?Oil prices on Wednesday surged above a record high $130 a barrel on a weakening US dollar and an OPEC statement it would maintain present production, sparking worries about stretched supplies amid strong demand for energy.

In Manila, the continued rise in global prices is expected to put greater pressure on local pump prices as domestic oil firms are in the middle of a series of weekly price hikes.

The cost of gasoline and diesel have gone up by at least 50 centavos a liter almost every weekend in the past three months. For gasoline alone, prices went up by P1 per liter every weekend in the past three weeks.

Earlier this month, oil executives had said they had not reflected in pump prices the previous rises in international prices, which were as much as between P6 and P7 a liter.

Since the beginning of the year, gasoline, diesel and kerosene prices have risen 11 times for a total of P7 a liter for gasoline and P6.50 for diesel and kerosene.

The main US oil futures contract?light, sweet crude for July delivery?rose as high as $130.47 in electronic trading on the New York Mercantile Exchange late Wednesday afternoon in Singapore.

The June contract, which expired Tuesday, shot to $129.60 before settling at $129.07 a barrel, up $2.02 from Monday. The expiration of the June contract created additional volatility as traders scrambled to lock in positions.

Wednesday?s performance was the 11th time in the last 13 sessions that world crude prices have hit trading or closing records, if not both.

In London, Brent North Sea crude for July also hit a historic high of $129.92 a barrel on Wednesday but later slightly pulled back to $129.74, up $1.90 from Tuesday?s closing price.

The market was awaiting the latest weekly snapshot of energy inventories in the United States?the world?s biggest consumer of oil?to be published by the US government later Wednesday.

?I keep making projections, and they keep turning out to be too low,? said Darin Newsom, senior analyst at market analysis provider DTN. ?We?re already pushing up against $130. If we clear that, there?s no reason to believe crude oil can?t get to $140.?

Tony Nunan, of Mitsubishi Corp.?s international petroleum business, said that concerns over supplies failing to keep up with demand were driving prices higher.

?The market is technically and fund-driven right now,? Nunan said, referring to investors buying into oil in hopes for higher returns.

Weaker dollar

David Moore, a commodity strategist at the Commonwealth Bank of Australia, said ?the recent trend for analysts to revise higher their oil price forecasts? and a weaker US dollar were helping to push up prices.

The US dollar slid to a one-month low against a basket of currencies on Wednesday on expectations of higher euro zone interest rates. A sliding dollar has made oil cheaper for some buyers overseas.

OPEC response

?A weak dollar boosts buying of commodities as a counterhedge,? said Mark Pervan, a senior commodities analyst at Australia & New Zealand Bank.

Oil futures are now selling for about twice what they were just a year ago, propelled by a number of factors, including worries about insufficient supply and soaring global demand.

Despite record-high oil prices, members of the Organization of the Petroleum Exporting Countries (OPEC) have repeatedly rebuffed calls for more supplies from consumer nations hard hit by the inflation in fuel costs. Cartel members have instead blamed the rally on rampant speculation.

Speaking to Reuters in an interview during a visit to Venezuela, OPEC Secretary General Abdullah al-Badri said oil prices could keep rising if non-market factors such as the weakening dollar continued to put pressure on prices. He said that OPEC would only act when market fundamentals showed a need to boost production.

US to sue OPEC

Algerian Energy Minister Chakib Khelil, OPEC?s current president, was also quoted by a government newspaper as saying the cartel would not boost output before the next OPEC meeting on Sept. 9.

The statements by the two OPEC officials added to worries about gasoline and diesel supplies at the start of the summer driving season in the United States, where retail prices for the motor fuels are already at record levels. Many analysts expect prices for gasoline and diesel to continue their rise.

In the latest swipe at the cartel over skyrocketing oil prices, the US House of Representatives on Tuesday approved legislation allowing the justice department to sue OPEC members in US courts over alleged price fixing.

US President George W. Bush, however, threatened to veto the measure because it could spur ?retaliatory action against American interests in those countries.?

A decision by OPEC member Saudi Arabia?the world?s biggest oil supplier?to raise output has not done much to ease the price rally, which energy analysts say has been fueled largely by resilient world energy demand even as the US economy slows.

Surging demand in China

In particular, industry observers are pointing to a strong demand for diesel in China, where power plants in some areas are running desperately short of coal and certain earthquake-hit regions are relying on diesel generators for power.

Analysts say China, the world?s second-biggest energy user, is also ramping up diesel imports ahead of the Olympics, driving up prices.

According to DTN?s Newsom, oil prices are likely to continue their rise at least through the beginning of the Olympic Games in August.

?China going into the Summer Olympics is putting its best face forward. They?re going to continue to bring in diesel for their power plants and are going to have plenty on hand,? Newsom said. ?What?s going to happen after that, we don?t know.?

Since 2002, world oil prices have risen six-fold as surging demand in China and other developing economies strained supplies and drew in a wave of investor interest.

Exploiting unrest

Oil prices have jumped more than a quarter since the start of 2008 when they struck $100 a barrel for the first time.

Many OPEC officials, however, argue that record oil prices are being driven by speculators seizing on geopolitical unrest, such as in Nigeria?Africa?s biggest exporter of crude.

Eric Wittenauer, analyst at Wachovia Securities, said reports about growing tensions between Washington and Teheran had also heightened concerns about a conflict that could affect oil supplies in Iran and the wider Middle East.

According to Wittenauer, the market reacted to an article in the Jerusalem Post that said President Bush ?intends to attack Iran before the end of his term.? Reports from Associated Press, Agence France-Presse and Reuters