Oil prices are continuing to surge, creating fears that demand may outstrip supply.

US light sweet crude touched $60.46, before dipping to trade 53 cents higher at $60.37. The other main contract, Brent, rose 50 cents to $58.86.

According to media reports, analysts said prices are likely to stay around the $60 mark for some time.

Concerns over rising tensions between the US and Iran were also thought to be pushing prices upwards.

Also driving gains on Monday were concerns of a clash between Iran's newly elected President and the US.

During the past 12 months, the price of crude has jumped by almost two-thirds, though the rise has done little to lower demand.

Oil production group Opec has been repeatedly called upon to increase the amount of oil it pumps and recently responded by increasing its production ceiling by 500,000 barrels a day. It said it is doing all it can to cool oil prices and is reported to be considering a further rise in production.

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