Oil jumps to record highs above $145

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Expectation was high that a combination of a weak U.S. dollar, lower U.S. crude stocks and tension between Israel and major oil producer Iran would push prices to $150 before the close of trade, in line with a prediction made last month.

Investment bank Morgan Stanley, one of Wall Street's biggest energy traders, said on June 6 that crude could reach $150 by July 4.

U.S. crude rose to a high of $145.85 a barrel. It was trading $1.88 higher at $145.45 by 11:42 a.m.

London Brent crude hit an even higher peak of $146.69. It was trading $1.97 higher at $146.23.

Saudi Oil Minister Ali al-Naimi was more reluctant to make predictions.

Asked at a conference in Madrid whether oil would hit $150, he replied: "If I knew that, I'd be in Las Vegas."

He also said Saudi Arabia would pump more oil if there were demand for it, but that his customers were satisfied and that the market was driven by a range of factors, but not by any lack of supply.

One of those factors is the weakening U.S. dollar.

The currency was forecast to fall further when the European Central Bank announces what is expected to be its first rate rise in more than a year at 12:45 p.m., potentially strengthening the euro against the dollar.

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