Troubles in US Spike Oil Prices

Oil prices have risen by $1 to over $72 a barrel after the US Federal reserve announced a cut in its discount rate to restore order to troubled financial markets.

Oil remains vulnerable to further losses, say analysts commenting on markets that have been hit by fears of financial instability after troubles with US mortgages and credit schemes.

Hurricane Dean which is moving towards the oil rigs in the Gulf of Mexico has also left analysts nervous of damage to rigs which pump out a third of US oil output.