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London: Oil held near its lifetime high of $100 a barrel and gold hit a new record on Thursday as fears of inflation and dollar weakness fired up markets that scored impressive rallies through 2007.
Its rise to triple digits may help push top consumer the US - battered by a housing crisis and credit crunch - into recession.
But after rising 57 per cent in 2007, oil and other commodities may push higher still, analysts said. Gold and platinum hit fresh record highs yesterday.
US crude rose two cents from the previous close to $99.64 a barrel by 1056 GMT. US crude traded a single lot at $100 a barrel on Wednesday, stoked by violence in oil exporters Nigeria and Algeria.
London Brent crude shed three cents to $97.81.
"We still have our maximum quota on oil and we don't see any reason to lighten up our position at all since all the risks are still to the upside," said Justin Wilks of the index-based Global Commodities fund group in Australia.
"Our appetite for oil hasn't waned at all."
The focus is soon to shift to sinking US crude stocks, which were expected to have fallen by another 2.2 million barrels last week, a seventh successive draw.
Gold and platinum soared to historic highs as speculators and investors snapped them up on the back of strong oil prices and expectations for further US interest rate cuts, analysts said.
Gold's allure as a hedge against inflation and a safe-haven asset got a boost as oil leapt to a lifetime high and the dollar tumbled.
"With the dollar under pressure once again and new year fund allocations being made, it is not surprising that a range of commodities has started 2008 very strongly," said Tom Kendall, metals strategist at Mitsubishi Corporation.
"We do not see any change to the bullish drivers for gold in the short term and the market could easily add another $15 to $20 before correcting," he said, adding the metal was getting help from geopolitical instability.
Spot gold rose as high as $868 an ounce and was quoted at $863.70/864.40 by 1301 GMT, up from $855.70/856.50 late in New York on Wednesday. The metal jumped more than 30 per cent in 2007, its biggest annual gain since 1979.
While dollar was steadier against euro, analysts expected further falls given prospects of sharp US rate cuts. A weaker dollar makes gold cheaper for holders of other currencies and often lifts demand.
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