* Libya stalemate supports oil prices
* Investors worry about supply ahead of Nigerian elections
* Coming up: CFTC positions data at 3:30 EDT Friday
(Recasts, updates prices and market activity)
By Robert Gibbons
NEW YORK, April 8 (Reuters) - Brent crude jumped nearly 3 percent to a
32-month high above $126 on Friday and U.S. oil scaled $112 a barrel as
commodities climbed on a weaker dollar and after attacks on Libyan oil
fields made long-term supply cuts more likely.
Brent was poised for a fourth consecutive weekly gain, and its 6
percent rise would be the largest percentage rise since the week to Feb.
25.
In addition to the Libyan conflict, ongoing unrest in the Middle East
and bomb attacks intended to postpone Nigerian elections added to oil
supply concerns. For details, see [] and []
Brent crude for May <LCOc1> rose $3.28 to $125.95 a barrel by 1:42 p.m.
[], having hit $126.40, the highest front-month price since August
2008.
U.S. crude <CLc1> rose $2.08 to $112.38 after earlier reaching $112.58,
the highest intraday price since September 2008.
U.S. crude trading volumes had surpassed Brent volumes after U.S.
totals had lagged earlier. U.S. crude volumes the previous two weeks were
the lowest weekly volumes for 2011.
"It's definitely momentum trading on all the troubles: Libya, Nigeria,
Yemen, Bahrain and also on the uncertainty about a (U.S.) budget deal. No
one is going to want to go home too short this weekend," said Dan Flynn,
analyst at PFGBest Research in Chicago.
Libya's civil war has cut its normal output of 1.6 million barrels per
day (bpd) by 80 percent to between 250,000 and 300,000 bpd, according to a
senior government official.
NATO leaders have acknowledged the limits of their air power, with
analysts predicting a drawn-out conflict. []
"Troubles in Libya mean Gaddafi has caused damage to the Sirte basin,
which has about two-thirds of their oil. There's dollar weakness and some
very large fund action piling into the market in oil and base metals," said
Rob Montefusco, an oil trader at Sucden Financial.
Libya's fellow OPEC member Nigeria, which produces 1.9 million bpd,
postponed parliamentary elections again in some areas, although polls will
go ahead in most of the country on Saturday as planned. []
COMMODITIES BOOMING
Crude prices rallied in step with gains across the commodities markets,
where gold hit a record high and copper rose to its highest in month,
driven by a weaker dollar <.DXY> and inflation concerns. [] []
[]
A weaker dollar often lifts dollar-denominated commodities because they
become attractive as a hard-asset inflation hedge and demand can be stoked
by cheaper prices for consumers using other currencies.
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Three-month technical views on 28 commodities:
http://link.reuters.com/pyx78r
Rising oil prices good for equities once again:
http://r.reuters.com/zyt88r
Reuters Insider Special - Doomsday Scenarios for Oil:
http://link.reuters.com/ner88r
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"New investment flows at the start of the quarter are driving oil and
gold this morning, with the strong rise over the past week attracting trend
followers and more fund money," said Michael Guido, director of hedge fund
energy sales at Macquarie Bank in New York.
"The uptrend is still very much intact, with key technical levels being
taken out."
The surge in oil prices is stoking inflationary concerns worldwide due
to the potential adverse impact on economic growth and the risk of demand
destruction.
(Additional reporting by Gene Ramos and David Sheppard in New York,
Nia Williams in London and Randy Fabi and Alejandro Barbajosa in Singapore;
editing by John Picinich)
