Oil hit $100 a barrel in New York today for the first time while Gold surged to a record $859.30 an ounce in London - beating the $850 fixing high recorded in 1980.

The surge in the value of crude, amid thin trading, follows violence in Nigeria, Africa’s largest oil producer, as well as a warning from Opec that it may not be able to meet its share of global oil demand by 2024.

It is also a reaction to the weaker dollar and a broader flight into safe-haven investments.

US crude futures gained more than $4 a barrel to hit $100. In London, Brent crude rose $3.63 to $97.48.

In Nigeria bands of armed men invaded Port Harcourt, the centre of the oil industry on Tuesday, attacking two police stations and raiding the lobby of a major hotel.

Four policemen, three civilians and six attackers were killed. The Niger Delta Vigilante Movement claimed responsibility for the attack.

“Although the violence has not impacted oil flow out of the country, it has reignited supply concerns as militant attacks have reduced Nigeria’s crude output by roughly 20 percent since 2006,” said John Gerdes, an analyst at SunTrust Robinson Humphrey.

Talk that several Mexican oil export ports were closed due to rough weather also stoked the market.

Oil last traded at more than $99 a barrel on November 26, a few days after rising to a previous record high of $99.29.

Oil prices are now within the range of inflation-adjusted highs set in early 1980. Depending on how the adjustment is calculated, $38 a barrel then would be worth $96 to $103 or more today.

Trading volumes were about 50 per cent of normal Wednesday, meaning the price move was likely exaggerated by speculative buying.

Earlier in the day in London, Gold had hit a fresh high, at $859.30 an ounce, following renewed US dollar weakness and fuelling speculation that the subprime crisis is spreading into the wider economy.

Gold, widely regarded a hedge against oil-led inflation, gained more than 30 per cent in value in 2007.

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