NEW YORK (Reuters) - "Oil rose on Friday, hitting an 11-month high above $77 a barrel on speculative buying as North Sea production problems and forecasts for rising demand tightened the supply outlook.

      Oil has gained more than $6 in two weeks on a wave of buying by funds during the U.S. summer vacation season, when demand for gasoline peaks in the top oil-consuming country.

      Global benchmark crude London Brent settled up $1.17 to $77.57 a barrel. Earlier, it reached an 11-month high of $77.68 -- a dollar short of last August's $78.65 all-time record. U.S. crude gained $1.43 to $73.93 a barrel.

      Prices were boosted by news UK North Sea oil and gas production could be affected for weeks after a ship's anchor damaged a pipeline needed to export associated gas to Britain.

      Some field operators say oil production was affected by the July 1 closure of the Central Area Transmission System (CATS) gas pipeline.

      The disruption also helped push prices for the prompt August Brent contract above later months.

      "The Brent market remains the chief locomotive for the bull market here, with pipeline issues that could last for a few weeks resulting in a nearby squeeze that has pushed the nearby futures above the forward market." Tim Evans of Citigroup.

      The rising stream of cash from speculative funds also helped drive prices higher.

      This as Mexico hears it's pretty much bone dry with its own Oil supplies.  Any new surprises tommorow?

      NEW YORK (Reuters) - "The dollar was flat against the euro on Friday, supported by a six-month high in U.S. consumer sentiment, even though an unexpected fall in retail sales last month and troubles in credit markets loomed.

      The dollar fell against a basket of six major currencies for the sixth consecutive day, suffering the second-largest weekly decline this year, because of fears the U.S. subprime mortgage crisis could frighten foreign investors away from U.S. credit markets.

      The boost in consumer sentiment for July did little to improve the market's perceptions of the dollar despite a surging U.S. stock market. Many traders still expect benchmark U.S. interest rates to stay on hold, while other central banks keep tightening monetary policy.

      "The U.S. dollar itself is the single biggest exception to the general resiliency that the global economy is demonstrating, which tends to be underappreciated by most observers," said Marc Chandler, global head of currency strategy with Brown Brothers Harriman.

      "The most compelling diagnosis of the dollar attributes its ailment to the fact that most market participants, including a strong majority of primary dealers, cannot see the Federal Reserve raising interest rates."

      By late afternoon, the euro was flat on the day at $1.3780 after hitting a lifetime high of $1.3815 overnight, according to electronic trading platform EBS.

      Ecuador (National Geographic) - "The fizzy gases that cause some volcanoes to blow their tops—like champagne bubbles popping a cork—appear to originate deep beneath the surface, a new study suggests.

      Scientists have long known that during an eruption, gases fizz out of magma as the molten rock rises to the surface.

      But in some types of magma, small bubbles coalesce into larger, gaseous "slugs" that rise upward, causing fiery bursts when they reach the surface.

      Such is the case at Italy's Stromboli volcano, a 3,050-foot (925-meter) cone that sits on a small island north of Sicily.

      The volcano has been continuously active for at least 2,000 years, earning it the nickname "Lighthouse of the Mediterranean."

      Every 10 to 20 minutes Stromboli shoots fiery blobs in fountainlike geysers as high as 300 feet (100 meters) above the crater.

      These bursts, dubbed strombolian eruptions, are associated with seismic activity not far beneath the crater, so volcanologists had assumed that the slugs formed in that region.

      But the new study, to be published in tomorrow's issue of the journal Science, found that the belches actually begin much deeper underground—perhaps as deep as the base of the mountain.

      Learning more about Stromboli is important, the scientists said, because the mountain produces much larger explosions several times a year (see a photo of a recent Strombli eruption). These violent blasts pose a major hazard for tourists and scientists observing the peak from a nearby overlook.

      "Therefore, improved understanding of the processes controlling the different types of explosions at Stromboli is … a high priority," the team wrote.

Gases From the Deep

      Mike Burton of Italy's National Institute of Geophysics and Volcanology led the team that studied the gases emitted from Stromboli's main crater..."

       WASHINGTON (AP) -- "Al Qaeda is stepping up its efforts to sneak terror operatives into the United States and has acquired most of the capabilities it needs to strike here, according to a new U.S. intelligence assessment, The Associated Press has learned.

      The draft National Intelligence Estimate is expected to paint an increasingly worrisome portrait of al Qaeda's ability to use its base along the Pakistan-Afghan border to launch and inspire attacks, even as Bush administration officials say the U.S. is safer nearly six years into the war on terror.

      Among the key findings of the classified estimate, which is still in draft form and must be approved by all 16 U.S. spy agencies:

      Al Qaeda is probably still pursuing chemical, biological or nuclear weapons and would use them if its operatives developed sufficient capability.

      The terror group has been able to restore three of the four key tools it would need to launch an attack on U.S. soil: a safe haven in Pakistan's tribal areas, operational lieutenants and senior leaders. It could not immediately be learned what the missing fourth element is.

      The group will bolster its efforts to position operatives inside U.S. borders. In public statements, U.S. officials have expressed concern about the ease with which people can enter the United States through Europe because of a program that allows most Europeans to enter without visas.

      The document also discusses increasing concern about individuals already inside the United States who are adopting an extremist brand of Islam.

      On a positive note, analysts concluded that increased international efforts over the past five years "have constrained the ability of al Qaeda to attack the U.S. homeland again and have led terrorist groups to perceive the homeland as a harder target to strike than on 9/11."

      Those measures helped disrupt known plots against the United States, the analysts found.

      National Intelligence Estimates are the most authoritative written judgments that reflect the consensus long-term thinking of senior intelligence analysts.

      Government officials, who spoke on condition of anonymity because the report has not been finalized, described it as an expansive look at potential threats within the United States and said it required the cooperation of a number of national security agencies, including the CIA, FBI, Homeland Security Department and National Counterterrorism Center.

      National security officials met at the White House on Thursday about the intelligence estimate and related counterterrorism issues. The tentative plan is to release a declassified version of the report and brief Congress on Tuesday, one government official said.

      Ross Feinstein, spokesman for National Intelligence Director Mike McConnell, declined to discuss the document's specific contents. But he said it would be consistent with statements made by senior government officials at congressional hearings and elsewhere..."

      Really it's not that hard.  They can waltz right across the Mexico-U.S. Border without anything to stop them.  Personally I think this is just Fear-Mongering.

      DALLAS (Fox) —  "Dallas-based chain Value Giant announced in a press release Thursday that their retail stores will begin accepting Mexican pesos as payment, according to MyFOXDFW.com. 

      The Value Giant store at Southwest Center Mall will be hosting a promotional event on Saturday to introduce the new policy.

      Value Giant is a regional discount retailer offering groceries, clothes, electronics and general merchandise.

      In January, another Dallas-based business, Pizza Patron, created controversy with its announcement that it would accept the Mexican currency.

      Pizza Patron has reported increased profits since the decision was made..."

      TOKYO (MSNBC) - "A powerful typhoon pounded Japan’s southern Okinawa island chain Friday, cutting power to tens of thousands of households and grounding hundreds of flights.

      Typhoon Man-Yi had injured seven people as of Friday morning, including one man who fell from his roof and a woman who was blown over and gashed her head.

      Man-Yi clocked sustained wind speeds of up to 112 miles per hour as it slammed into Naha, the prefectural capital of Okinawa, the Meteorological Agency said.

      The typhoon was moving northward at a speed of 12 miles per hour and was forecast to hit the southern main island of Kyushu on Saturday, the agency said.

      It is expected to then rake the Japan’s Pacific coast toward Tokyo, but the agency did not say if the typhoon would hit the capital.

      About 60,000 households were without power — 11 percent of all households in Okinawa, according to Tomoko Sunagawa, an official of Okinawa Electric Power Co. It was not immediately clear when power would be restored.

      “It is raining hard and the wind is very strong. It looks all white outside,” Sunagawa said by phone from Naha.

      Airlines have canceled more than 300 flights to and from Okinawa and Kyushu, according to Kyodo News agency..."

      TOKYO (Reuters) - "Gold edged up near a one-month high on Thursday as the dollar's falls and sharp volatility in U.S. stock and bond markets this week induced safe-haven buying.

      Funds flocked into precious metals as they were cheaper relative to other commodities such as crude oil and industrial metals, which have risen more sharply in the last several weeks.

      Fund buying also emerged as technical sentiment brightened, especially after the cash gold price <XAU=> briefly cracked the closely watched level of $665 an ounce the previous day.

      By 0345 GMT, spot gold <XAU=> was trading at $661.80/662.60, up from $660.30/660.90 late in New York on Wednesday, when it rallied to its highest in a month at $665.90 on a weak dollar.

      "Funds are shifting more into gold for safe-haven reasons as currencies, stocks and bonds are all volatile now," said Tatsuo Kageyama, analyst at Kanetsu Asset Management.

      "Gold is gathering a lot of interest on price dips as technical sentiment improved after breaking through $665 yesterday," Kageyama said.

      The level of around $665 is seen as an important chart point, marking the 50 percent retracement point between a one-year high of around $693 in April and a low of $638.90 hit late last month, Tokyo traders said.

      A Reuters poll suggested on Wednesday that average gold prices would jump nearly 10 percent this year and gain further in 2008 on a weaker outlook for the dollar, less aggressive sales by central banks and physical demand.

      It would be nice if we had a currency that was backed in Gold, Silver and other precious metals.  But it's backed in words only.

      Either way, the paper money is still ideal for kindling should things get to that point.

"I sincerely believe that banking establishments are more dangerous than standing armies, and that the principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale." -- Thomas Jefferson

      SINGAPORE (Reuters) - "Oil prices hovered below $76 a barrel on Thursday, but nagging concerns over gasoline supplies and a drop in crude stocks in the United States helped the market recoup some losses.

      London Brent crude, seen as the best indicator of the global market, was up 7 cents at $75.51 a barrel by 0330 GMT, after sliding 96 cents on Wednesday.

      U.S. crude edged up 9 cents at $72.65 after falling 25 cents a day earlier.

      U.S. Energy Information Administration data showed a 1.2 million-barrel increase in gasoline inventories in the week ended July 6, just above analysts' forecasts for a 900,000 barrel-build.

      But gasoline stocks remained 8.2 million barrels lower than a year ago, while the peak demand season is expected to last at least more than a month.

      "Yes gasoline stocks rose last week, but it is difficult for traders to sell when the U.S. gasoline stocks are still at a low level," said Ken Hasegawa of Himawari CX.

      "I think crude oil prices are still within sight of record highs."

      U.S. refiners have struggled with unexpected outages this year that drained gasoline stocks ahead of the summer driving season, when demand for the motor fuel peaks.

      PHILADELPHIA (Reuters) - "Two Philadelphia City Council members sued the Pennsylvania legislature on Wednesday for not allowing the city to enforce stricter gun-control laws amid a surge in violence in the city.

      Democrats Darrell Clarke and Donna Reed Miller, in the lawsuit filed in the Philadelphia Court of Common Pleas, say state lawmakers have failed to protect Philadelphia residents from firearms that have caused most of the 212 homicides -- the highest rate in a decade -- in the city so far this year."

    I know how dangerous those firearms can be.  They cause the crime, not the people; no.  The firearms roam the streets, shooting anyone who looks at them funny. 

(Note my sarcasm)

    Give me a f*cking break!  The Lawmakers aren't responsible for "protecting" residents anyway; that's a job for the police.  They should be suing for more police funding, not looking for a sollution to a problem that doesn't exist. 

     CRIME is the problem, not firearms.  IDIOTS.  Over 500,000 potentially violent crimes are prevented each year in America from the mere presence or use of a firearm in a legal and defensive manner.  Wake up people; if you are not armed, YOU ARE NOT FREE. 

     Those without the capacity to defend their lives are already under the control of those who do and mean to manipulate you.

      "The suit's backers say the state legislature, which under Pennsylvania law must approve gun laws sought by a city, has created a "state of danger" in Philadelphia. They argue that the suit qualifies as an exemption to "sovereign immunity," a law that typically protects governments from lawsuits.

      At a news conference, Clarke said state lawmakers had failed to authorize seven city ordinances on gun control that were passed by the Democratic-controlled City Council and signed by Mayor John Street in May.

      Among the laws sought by Philadelphia are a purchase limit of one handgun a month, a measure designed to crack down on so-called straw purchasers, who buy multiple guns on behalf of those who cannot legally do so themselves, usually because of a criminal record."

      First off, let me state that ANY JACKASS who makes a straw purchase for someone is themselves committing a felony.  They get caught then lose their right to buy a firearm (forever). 

      Over 20,000 gun-control laws on the books in the U.S., and these morons want more.  I say enforce what'cha got, and deal with it.  Up your Police Forces and shut the hell up!

      "The suit is the latest response to an increase in gun violence that has given Philadelphia the highest per-capita homicide rate among the 10 largest U.S. cities, despite efforts by police, city government and community groups to stop the killing.

      "We can't continue to have vigils, task forces and marches," Clarke said. "Something has to happen."

      Miller accused the state legislature of a "blatant disregard and disrespect for Philadelphia and its residents."

      SINGAPORE (Reuters) - "Asian stocks tumbled on Wednesday and the dollar plumbed a record low against the euro as investors fretted that growing problems in the U.S. subprime mortgage sector will spread to the wider economy.

      Global markets were rattled on Tuesday after two leading rating agencies started to slash ratings for more than $17.3 billion of U.S. mortgage-related debt, raising concerns that the sector's woes are worse than previously thought.

      Tokyo's Nikkei (.N225: Quote, Profile, Research) dropped more than 1 percent by the market's midday break on Wednesday, retreating further from a seven-year closing high reached on Monday.(.T: Quote, Profile, Research)

      Wall Street's weakness and a rise in the yen as the dollar fell spurred broad selling of shares, including Japanese exporters such as Sony Corp. (6758.T: Quote, Profile, Research).

      MSCI's index of shares elsewhere in Asia (.MSCIAPJ: Quote, Profile, Research), which has risen to record high closes for six straight sessions, fell 0.75 percent.

      "From the perspective of liquidity, there is no market in the world that is not affected by the fallout of the subprime problem. Everyone is linked to this," said Koichi Ogawa, chief portfolio manager at Daiwa SB Investments.

      "Liquidity has been driving hedge funds and private equity over the past few years. Problems have since surfaced with hedge funds. Now if there is a cloud emerging over liquidity, there is no global market that will not be impacted."

      In case you ever had any doubt about the severity of our socio-economic crisis, this should open your eyes enough to at least yield reasonable caution.

      You can have as much faith in your "system" of economy as you want, but faith alone won't keep you alive one day when the shelves at your grocery store go empty and don't get re-stocked... the power goes out and doesn't come back on. 

      Most would laugh at such concepts, but the direction these problems are heading (to a convergence of chaos), are going full-steam ahead.  If you havn't already, visit the Resources Section and download (for free) our PDF's on many important Readiness topics. 

      This Wisdom should be known by all Americans who take their preparedness seriously.  It is better to have the wisdom of preparedness and not need it, than to one day need it and not have it.

      WASHINGTON (AP) - "U.S. counterterror officials are warning of an increased risk of an attack this summer, given al-Qaida's apparent interest in summertime strikes and increased al-Qaida training in the Afghan-Pakistani border region.

      On Tuesday, Homeland Security Secretary Michael Chertoff told the editorial board of The Chicago Tribune that he had a "gut feeling" about a new period of increased risk.

      He based his assessment on earlier patterns of terrorists in Europe and intelligence he would not disclose.

      "Summertime seems to be appealing to them," Chertoff said in his discussion with the newspaper about terrorists. "We worry that they are rebuilding their activities."

      Other U.S. counterterrorism officials, who spoke on condition of anonymity, shared Chertoff's concern and said that al-Qaida and like-minded groups have been able to plot and train more freely in the tribal areas along the Afghan-Pakistani border in recent months. Osama bin Laden and his top deputy, Ayman al-Zawahri, are believed to be hiding in the rugged region.

      "The threat coming out of there is very real, even if there aren't a lot of specifics attached to it," one of the officials said.

      Chertoff's department has not made any move to increase the nation's color-coded terror alert system. Now, airlines are under orange — or high — alert, which is the second most serious level on a five-point scale. The rest of the country remains a step below at yellow, or elevated..."

      MEXICO CITY, Mexico (Reuters)  -- Mexico said on Tuesday it would tighten security at strategic installations after a shadowy leftist rebel group claimed responsibility for a rash of fuel pipeline explosions.

      Presidential spokesman Maximiliano Cortazar said investigations were under way into an explosion at a natural gas pipeline in the early hours of Tuesday and three other pipeline blasts last Thursday.

      The four blasts shut down pipelines supplying natural gas, liquefied petroleum gas, crude oil and gasoline to the domestic market.

      But none of the blasts affected oil exports and no injuries were reported, according to state oil monopoly Pemex.

      The Popular Revolutionary Army, or EPR -- which emerged in 1996 and is active in the poor southern states of Guerrero, Michoacan, Oaxaca and Chiapas -- claimed responsibility on Tuesday and said it had begun a campaign against the conservative government whose 2006 election win was contested by leftists.

      "The Mexican government categorically condemns the attacks on Pemex installations. This criminal conduct tries to weaken democratic institutions," the Interior Ministry said in a statement.

      "The federal government is taking all the necessary measures to increase security around the country's strategic installations."

      Firefighters brought under control Tuesday's blaze at a 36-inch (91.5-cm) natural gas pipeline running between Mexico City and the western city of Guadalajara, and people living nearby were evacuated to safety..."

      NEW YORK (Reuters) - "Oil jumped to an 11-month high above $76 a barrel on Tuesday and neared a new record as tensions mounted between Iran and the United States and speculators kept pouring money into energy markets.

      London Brent crude, currently seen as the best indicator of global oil prices, rose 79 cents to $76.57 a barrel at 1244 EDT after trading up to $76.63 earlier. U.S. crude was up 68 cents at $72.87.

      Oil has been tipping highs not reached since August 2006 over the past week as geopolitical tensions stoke concerns about supplies from top producer nations.

      An Iranian newspaper quoted a senior adviser to Supreme Leader Ayatollah Ali Khamenei saying Iran was producing centrifuges for refining uranium domestically, limiting the impact of United Nations sanctions.

      The United States, which believes Iran is trying to build a nuclear bomb, has sent a third aircraft carrier to the area where its Fifth Fleet is operating, including waters close to Iran, the U.S. Navy said.

      "It's the Iran story, that it is producing its centrifuges for refining uranium," said Nauman Barakat, senior vice president at Macquarie Futures USA of oil's rise.

      Some investors and analysts said a wave of speculative investment was the main driver. Speculators boosted their net long positions in the New York Mercantile Exchange crude oil market to a record in the week to July 3, data showed.

      Olivier Jakob, an analyst at Swiss-based Petromatrix, noted the continued rise in prices and open interest -- the number of contracts that have not been closed -- pointed to more investment money flowing into oil in recent days..."

      In the words of our friend, Rzero, in the Netherlands, "We'll be killing each other over a tank of gas within 5 years". 

      I hope you're wrong man... 

      NEW YORK (Reuters) - "The dollar hit a record low against the euro and 26-year troughs against sterling on Tuesday, as investors fretted about a possible fallout from weakness in the U.S. subprime mortgage market.

      The dollar also slumped nearly 1 percent against the yen, as risk-averse investors cut back on "carry trade" transactions funded by borrowing in the Japanese currency.

      In carry trades, investors borrow in a low-yielding currency such as the yen to buy higher-yielding units such as the dollar.

      "This is a combination of unwinding of carry trades and broad dollar weakness, mainly because of what S&P did," said Ashraf Laidi, chief currency analyst, at CMC Markets in New York.

      On Tuesday, Standard & Poor's said it may cut 612 residential mortgage-backed securities backed by U.S. subprime loans, affecting $12 billion in debt. Subprime loans are extended to borrowers with poor credit.

      The subprime news pushed down U.S. stocks, bond yields and the dollar across the board.

      The euro rose to $1.3741against the dollar, a record high, according to electronic trading platform EBS, before falling back to $1.3713, still up 0.6 percent on the day.

More:

CDOs could be Wall Street's next bogeyman

      HARARE, Zimbabwe (AP) -- "Zimbabwe's economy veered closer to the brink with no end in sight to chronic shortages of staple foods and gasoline, and predictions of a standstill in routine business within days.

      Police and government inspectors continued cracking down on shopkeepers and sales managers accused of defying orders to slash prices by half in a desperate attempt to halt rampant inflation.

      Shelves were bare of cornmeal, bread, meat and other staples, and witnesses said many shops and suppliers were cleaned out by convoys of ruling party supporters coming in after police and inspectors began enforcing the price cuts on June 26.

    "The crunch can't be far off," said economist John Robertson.

      Factories, stores and gas stations have been unable to replace goods sold at below the original cost. The sudden drop in prices has sparked panic buying, stampedes and near-riots by impoverished Zimbabweans.

      Fuel stocks have run out, putting an end to the long lines of cars at gas stations. On Monday, the government ordered private commuter buses to cut fares by three-fourths, promising bus owners they would be able to buy subsidized fuel from the state oil procurement agency.

      But many ignored the directive and simply abandoned their routes. Businesses reported higher absenteeism, with workers failing to arrive at their jobs.

      "We are incurring huge losses. We can't go on like this for much longer," said one industrialist. "We won't be able to pay our VAT [value added tax], which runs into the billions each month.

      "We'll have to lay off quite a number of our people very soon," he said. "We've shot ourselves in the foot this time."

      He asked not to be identified. President Robert Mugabe warned Friday that the government would target uncooperative managers and seize factories that scaled down their operations.

      More than 1,300 businesses have been charged and fined over the past two weeks for defying orders to slash prices in half or hoarding goods, police said.

      Several of 33 top company executives arrested in recent days were fined up to 100 million Zimbabwean dollars (US$6,600; euro4,850), court officials said Monday.

      Robertson, the economist, predicted that shortages would worsen dramatically across the board..."

      That's all folks.  Game is over.  This joint is closed.  Cash your chips in at the front desk.

     HARRISBURG, Pa. (Fox))—  "Gov. Ed Rendell late Sunday ordered a range of state government services shut down and placed about a third of the state work force on indefinite unpaid furlough after frantic last-minute negotiations failed to break a budget stalemate.

      Rendell, appearing outside his Capitol office, said the shutdown would go forward but added that he was optimistic that he and legislators could come to an agreement within a day.

      "Let me say to our hardworking and dedicated state employees, I'm sorry we're here. We worked as hard as we could today to get this done," Rendell said. But, he said, negotiations and serious consideration of his priorities, which he maintains must be passed along with a state spending plan, began too late.

      "We didn't start early enough," Rendell said. "I think everybody was at fault for not starting early enough."

      Pennsylvanians on Monday will no longer be able to take driver's license tests, state-run museums will be shuttered and casinos will have to stop taking bets. Highway maintenance and a range of permitting and licensing functions will be stopped or severely curtailed, and the lights illuminating the Capitol's dome were to be turned off.

      Critical services — such as health care for the poor, state police patrols and prisons — will be maintained..."

     SIOUX FALLS, S.D. (Fox) —  "One of dozens of fires across the West raced out of a canyon in South Dakota's Black Hills "with a vengeance" on Sunday, killing a homeowner and destroying 27 homes, authorities said.

      Residents of about 50 homes had fled the wildfire near Hot Springs, which also injured two firefighters and closed a section of a state highway, state and federal officials said. An area of roughly 9 square miles has burned since the fire was sparked Saturday by lightning.

      One person was killed trying to retrieve possessions from a home. The person's identity was withheld until relatives could be notified, authorities said.

      "This thing blew up because of extreme hot temperatures and the winds," said Joe Lowe, state wildland fire coordinator. "It came out of the canyon with a vengeance."

      Gov. Mike Rounds toured the area Sunday and noted that the trees around some houses were charred but the dwellings were intact.

      "I don't know how in the world you saved some of those homes," he told firefighters at an evening briefing.

      More than two dozen homes had no damage because of a high-tech gel made of water-filled bubbles.

      High wind near Wenatchee, Wash., overnight spread a brush fire that threatened homes. By Sunday morning, 250 to 270 homes had been evacuated, and at least three outbuildings were destroyed.

      In fire-swept Nevada, about 1,500 evacuees from Winnemucca were allowed home hours after a wildfire destroyed an electrical substation and several outbuildings, shut down Interstate 80, delayed trains, and killed livestock. No injuries were reported.

      "It was pretty hairy for quite a while, and people thought they would go back to nothing," Humboldt County Undersheriff Curtiss Kull said Sunday. "It was a huge wall of flame coming at the homes. It's amazing that no homes were lost."

      It was unknown how much of the fire was contained Sunday, and no estimate was provided on when full containment would be reached, said Jamie Thompson, a spokesman for the U.S. Bureau of Land Management..."

      NEW YORK (Reuters) - "Oil surged to an 11-month high above $76 a barrel on Friday, closing in on the all-time record as Nigerian disruptions and OPEC output cuts stirred supply concerns amid rising U.S. refiner demand.

      London Brent crude, currently seen as a better indicator of the global market, settled up 87 cents at $75.62 a barrel, after touching a session high of $76.01, its highest since August 2006. The rise put Brent within striking distance of the record $78.65 struck last August.

      U.S. crude gained $1.00 to $72.81, the highest settlement since August 22, 2006.

      "The global oil picture is fairly tight in terms of supply and demand growth," said Harry Tchilinguirian, senior oil market analyst at BNP Paribas.

      Global oil demand growth is increasing faster than non-OPEC supply in the second half of 2007 while OPEC has met most of its supply cuts and Nigeria's output is being disrupted.

      "Together, these elements are very supportive of prices," Tchilinguirian said.

NIGERIAN DISRUPTIONS

      Some 611,000 barrels per day (bpd) of Nigerian production is shut in after a year and a half of attacks on its oil industry.

      A one-month truce by the rebel group responsible for much of the violence directed at the Nigerian oil industry has recently ended. Nigerian rebels have attacked an oil rig and kidnapped a 3-year-old British girl in Port Harcourt in the oil producing Niger Delta.

      When is the ceiling on this price-rising?

      NEW YORK (Reuters) - "The dollar slid against the euro on Friday after an unexpectedly strong U.S. jobs report failed to change views that U.S. interest rates will stay on hold this year while overseas rates rise.

      The dollar initially rallied after the report, but quickly gave up its gains, hitting a 30-year low against the Canadian dollar and approaching a record low against the euro. A large U.S. bank and a central bank stepped in to buy euros, snuffing out a fleeting dollar rally after the data, traders said.

      The government's non-farm payrolls report, the most closely watched barometer of the health of the U.S. labor market, showed 132,000 jobs were created in June, beating the consensus forecast of 120,000 in a Reuters poll.

      The dollar rose for a fourth straight session against the yen. But it fared worse against European currencies as the jobs data merely confirmed a view that the Federal Reserve will keep interest rates on hold at 5.25 percent this year, in contrast to the euro zone and Britain, where further monetary tightening is in store.

      "The jobs data, combined with other strong reports earlier this week, show support to the dollar in the long run, but rates are still higher in Europe and will remain so for the time being," said Jason Schenker, an economist at Wachovia Bank in Charlotte, North Carolina.

      The euro was up 0.2 percent on the day at $1.3624, a little more than half a cent below a record high hit in April. Earlier in the session the euro had fallen as low as $1.3568 on electronic trading system EBS.

      "There was some sovereign buying of euros when we dipped marginally lower to around 1.3575 and the market got caught on the wrong side," a trader with a European bank said.

      The dollar was up 0.4 percent at 123.36 yen. Sterling was little changed on the day at $2.0104 , around a cent below a 26-year peak hit earlier in the week.

     Sydney  (ACN Newswire) - "The past few weeks have seen lots of gloom surrounding the investment outlook.

      The return of the sub-prime mortgage crisis in the US has led to renewed talk of a credit crunch. There has been talk of a looming "Great Depression" after the Bank for International Settlements annual report referred to parallels between the current situation and the 1920s.

      Even the headline "best financial year for Australian shares since 1987" has a somewhat negative undertone because we all know how 1987 ended.

      The AMP's chief strategist, Dr Shane Oliver, believes we are now entering a more risky phase in the cyclical bull market in shares, but it has further to go. Recent developments do nothing to change this.

      The sub-prime crisis and new debt instruments

      Worries about a US credit crunch weighing on investment markets and the US economy have re-emerged in the last few weeks after two US hedge funds experienced large losses on structured credit investments with exposure to sub-prime mortgages (loans to borrowers with poor credit credentials).

      In recent years there has been a boom in collateralised debt obligations (CDOs) and collateralised loan obligations (CLOs).

      These arise from pools of debt or loans which have been parcelled together and then sold off in tranches representing different levels of credit ratings and risk to hedge funds, pension funds and other investors.

      By doing this the risk is spread across multiple investors and hence the amount of capital raised can be greater.

      The US housing downturn has seen rising delinquencies and defaults, particularly among sub-prime borrowers.

      This has seen a fall in the value of mortgage debt and CDOs which are exposed to it. Many fret that the shake-out in CDOs on the back of the sub-prime crisis will feed through to the broader US credit market and undermine the flow of liquidity into the share market via leveraged buyouts.

      So far there is some tentative evidence of a spill over with the gap between speculative grade corporate debt yields and US treasury bond yields rising about 0.2% over the last few weeks and various private equity firms pulling out of buyout deals (such as Coles) as the cost of debt rose.

      It's likely that the US housing downturn will get worse before it gets better.

      A significant proportion of US subprime mortgages on low initial "teaser" loans are due to reset to higher adjustable rate loans. Lending conditions are tightening thanks to regulatory action and problems in the sub-prime securities markets and this will likely lead to a further fall in home sales and house prices.

      This could in turn all lead to further upset in sub-prime securities markets made worse by the uncertainty surrounding the actual exposure of US investors.

      More broadly, the housing downturn will help ensure that US economic growth remains sub-par over the rest of the year which should lead to a further reduction in inflation. This in turn will help put a lid on the recent back up in bond yields, if not reverse it..."