Oil prices nudged $100 a barrel today after surging to a record high as Asian markets plunged on the back of the weakening dollar and the deteriorating American economy.

US light crude rose to $99.29 a barrel, a 39 per cent rise in the price of fuel since the end of August, while London Brent crude rose 50 cents to $95.99 as traders reacted to the prospect of tightening oil supplies in colder weather.

Gold opened up, from $793 to $804.75 an ounce.

Opec, the 13-country cartel responsible for producing 40 per cent of the world’s oil, will discuss increasing fuel supplies next month.

However, the price of oil reacted against Opec’s discussions at a weekend summit meeting in Riyadh, that fuel should be priced in currencies other than the dollar.

The dollar has weakened today to $1.4841 against the euro and to 109.97 yen, sending the Japanese Nikkei 225 average down 2.5 per cent, or 373.86, to 14,837.66 points.

The Hang Seng index, in Hong Kong, also fell sharply, down 3.89 per cent, or 1,079.75 points, to 26,691.46.

Last night the US Federal Reserve cut its forecast for growth of the American economy from between 2.5 per cent and 2.75 per cent to a range of 1.8 per cent and 2.5 per cent.

The Fed revealed the change from its June forecast in the minutes from its meeting when the Federal Open Markets Committee voted for a quarter-point cut to the US interest rate to 4.5 per cent.

The American sub-prime mortgage crisis spread to more companies yesterday.

Freddie Mac, America's second-largest home loan buyer, revealing a fourfold increase in third-quarter losses to $2 billion while annual housebuilding figures slumped by 6.6 per cent to a 14-year low of 1.178 million in October.

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