Oil prices touched $US83 ($NZ117) yesterday, coming within $US2 of this year's high on a recovery in demand in the United States and Opec's decision to leave output targets unchanged.
Saudi Arabian oil representative Ali al-Naimi described current prices as "beautiful" as the Opec producer group decided to leave record output curbs unchanged at its meeting in Vienna.
Members of the Organisation of the Petroleum Exporting countries, which pumps about one in every three barrels of oil, maintained official cuts of 3.2 million barrels per day.
Since curbing output in December 2008 as the economic crisis intensified, Opec has seen prices rally from below $US40 a barrel to peak at nearly $US85 in January, despite lower compliance from some members in recent months.
Mr al-Naimi said global oil demand would grow by about one million barrels per day by the second half of this year.
"Good demand, reliable supply, beautiful prices - we are very happy. Everything is relative.
"If there was no demand, there would be no leakage," he said.
A recovery in the global economy and higher prices had encouraged revenue-hungry Opec members to pump more oil.
Saudi Arabia, Opec's largest producer, previously said oil at around $US75 a barrel was necessary to encourage investment in future supplies to meet booming demand from emerging economies and was ultimately good for both producers and consumers.
However, rising prices at the pumps had threatened to squeeze consumers still struggling in the aftermath of the worst recession for 70 years.
Retail petrol prices in the United States soared to their highest level in nearly 18 months last week and could soon top $US3 a gallon (about $NZ1.07 a litre), the US Department of Energy said on Monday.
Reuters reported that data from the US Energy Information Administration showed oil product demand in the US, the world's largest energy consumer, was up 3.5% last week compared to the corresponding period last year.
