AP:

Oil prices closed above US$100 per barrel for the first time as investors bet that crude prices would keep climbing despite evidence of plentiful supplies and falling demand.

Crude has hit the US$100 mark before, but only in intra-day trading.

There was no single driver behind oil's sharp price jump; investors seized on an explosion at a 67,000 barrel per day refinery in Texas, the falling dollar, the possibility that OPEC may cut production next month, and continuing tensions between the United States and Venezuela.

Two-month shutdown looms

The explosion Monday at Alon USA's Big Spring, Texas, refinery, could shutter the refinery for two months, helping send prices $4.51 higher.

Light, sweet crude for March delivery settled at a record US$100.01 a barrel on the New York Mercantile Exchange after earlier rising to $100.10, a new trading record. It was the first time since January 3 that oil had been above US$100.

Traders are now focused on the Organisation of Petroleum Exporting Countries (OPEC), which will meet early next month to map out production plans, and Venezuela, where President Hugo Chávez made conflicting statements this weekend about the country's legal dispute with Exxon Mobil Corp.

OPEC could move to cut production in the second quarter, typically a period of low demand, though many analysts feel that's unlikely.

In Venezuela, Chavez said he was not serious about an earlier threat to cut oil sales to the US, but also threatened to sue Exxon Mobil.

The world's largest oil company is fighting Venezuela's nationalisation of an oil project, and recently convinced several courts to freeze US$12 billion (€8.14 billion) in Venezuelan oil assets.