continuing unrest across the Middle East have pushed oil prices into a "danger zone" that could threaten global economic recovery, the International Energy Agency has warned.Fatih Birol, the IEA's chief economist, said high prices could put pressure on central banks to raise interest rates, especially in more developed countries such as the UK. "Oil prices are a serious risk for the global economic recovery," he said. "The global economic recovery is very fragile – especially in OECD countries." He said oil prices had entered a "danger zone" for the recovery at over $90 a barrel.
Brent crude prices fell back slightly from Monday's two-and-a-half-year high of $108.70 a barrel, but US oil prices at one stage rose by more than $8 a barrel to hit $94.49, the highest level since October 2008. That increase was partly a catch-up after the US markets were closed on Monday, but prices are also being driven by fears that unrest could spread to Saudi Arabia, the world's biggest crude exporter.
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