Crude oil rose above $117 a barrel for the first time after OPEC said it will maintain production, rejecting calls from the United Kingdom and Japan to boost output.
There is no shortage of oil in the market, Secretary-General Abdalla el-Badri said in Rome, blaming the weak dollar and speculators for high crude prices.
Even if the Organization of Petroleum Exporting Countries raises production, "we will not find people to buy the increment", President Chakib Khelil said, as cited by Kuwait's state news agency.
"The price seems to be rising inexorably towards $120," said Bill Farren-Price, director of energy at London-based Medley Global Advisors.
"OPEC has a very limited amount of spare capacity left and maybe they're trying to keep that in case there's actual physical disruption."
Crude oil for May delivery rose as much as 71 cents, or 0.6 percent, to $117.40 a barrel in electronic trading on the New York Mercantile Exchange, the highest since futures started trading in 1983. Oil traded at $116.74 at 11:05 am in London.
Prices advanced 6 percent last week, the biggest weekly gain since February 2007, and are up 77 percent from a year ago.
Brent crude oil for June settlement also touched an all-time high of $114.65 a barrel on London's ICE Futures Europe exchange. It traded for $113.93 at 11:07 am local time.
Prices were supported by potential supply disruptions in Nigeria, Africa's largest producer, and a possible strike at a refinery in Scotland.
The main militant group in Nigeria's oil-rich Niger Delta said it sabotaged a pipeline operated by a unit of Royal Dutch Shell Plc April 17.
Ineos Group Holdings Plc, a closely held chemicals company, may have until April 25 to prevent a shutdown of its 200,000 barrel-a-day refinery at Grangemouth in Scotland, causing possible fuel shortages in the region.
A full shutdown of the refinery, Britain's sixth largest, may cut output for as long as a month after the refinery's largest union failed to agree on a pension proposal, the union, Unite, said on April 18.