Saudis warn of shortfalls as oil hits $61

By Carola Hoyos and Neil Dennis in London
Published: July 6 2005 22:02 | Last updated: July 6 2005 22:02

Oil prices hit new record highs above $61 a barrel on Thursday, driven by short-term supply fears as the first hurricane of the season threatened crude production and refinery operations in the Gulf of Mexico.

But private warnings also point to a worsening long-term outllook, with Saudi officials saying that the Organisation of the Petroleum Exporting Countries will be unable to meet projected western demand in 10 to 15 years.