Prices for light sweet crude oil for an August delivery went up $1.70 to $78.40 per barrel, the highest price for oil since the exchange began trading crude futures in 1983 and prices could rise further, with the upcoming September contract already trading above $79 a barrel.
Thursday’s record high was set as tensions in the Middle East, between Lebanon and Israel, flared and attacks occurred on oil pipelines in Nigeria.
"Geopolitical tensions seem to be exploding all over the map... we are firing on all cylinders this week, and the only direction is higher still,"said Man Financial analyst Ed Meir.
John Kilduff at Fimat USA said traders were using oil as a safe haven investment, "As a globally important strategic commodity, it has become a haven for investors like gold and the dollar have traditionally been," he said.
"But unlike gold and the dollar it is not so much a flight to quality as it is flight to security: the security of a hard and potentially precious asset. It is likely that expanding geopolitical concerns in the Middle East and in India will continue to provide the complex with continued momentum," he added.