March 17 (Bloomberg) -- Crude climbed to a record $57.50 a barrel in New York, and fuel prices touched records, amid speculation the Organization of Petroleum Exporting Countries can't produce enough to meet rising demand.

OPEC may fail to ease oil prices because members can't pump much more, Venezuela's energy minister said today. The group, which produces about 40 percent of the world's oil, raised its output quotas to 27.5 million barrels a day yesterday and will let inventories increase in the second quarter, when consumption usually drops.

``There's runaway world demand and until that growth slows you will see prices accelerate,'' said Tom Bentz, an oil broker at BNP Paribas Commodity Futures Inc. in New York. ``The short- term fundamentals don't determine the direction right now.

Crude oil for April delivery rose 29 cents, or 0.5 percent, to $56.75 a barrel at 11:38 a.m. on the New York Mercantile Exchange. Futures touched $57.50 a barrel, the highest since the contract was introduced in March 1983 and a 49 percent increase in the past 12 months.

Prices yesterday surged past the previous record of $55.67 a barrel set Oct. 25. The price climbed above $55 five times in the past two weeks and failed to breach the record each time. The market may now be headed for $60 a barrel, Bentz said.

In London, the May Brent crude-oil futures contract rose 32 cents, or 0.6 percent, to $55.20 a barrel on the International Petroleum Exchange. Brent futures reached $56.15 a barrel, the highest since trading began in 1988.

Economic Growth

Higher prices may fuel inflation and slow economic growth, and they have stalled stock market gains. The MSCI World Index of shares of the largest companies worldwide has fallen seven straight days.

``I am concerned about the price of energy and what it means to the average American family when they see the price of gasoline going up,'' said President George W. Bush, speaking at a press conference in Washington.

Bush recommended that Congress pass a comprehensive energy bill he has proposed and open Alaska's Arctic National Wildlife Refuge to oil drilling. The Senate yesterday voted 51 to 49 in favor to drilling in the refuge, which has been off limits for more than 25 years, dealing a setback to environmentalists.

Scarce Capacity

``There is a lack of spare production, and this brings nervousness to the market,'' Rafael Ramirez, the oil minister for Venezuela, OPEC's third-largest oil producer, said in an interview today in Isfahan, Iran. ``We cannot do much more, only take this kind of decision. OPEC can help influence prices, but there are other strong factors'' at work in the market.

Gasoline for April delivery fell 0.23 cent to $1.546 a gallon in New York. Futures touched $1.5675 a gallon, the highest since the contract began trading in 1984. Gasoline is 35 percent higher than a year ago.

Retail gasoline prices have risen as wholesalers and station owners pass on higher costs. Pump prices for regular grade gasoline, averaged nationwide, rose 0.2 cent to a record $2.055 a gallon yesterday, according to the AAA, formerly the American Automobile Association.

Heating oil for April delivery was little changed at $1.5915 a gallon in New York. Futures touched $1.6174, the highest since the contract was introduced in 1978. Prices are 67 percent higher than a year ago.

`The Long Run'

``My sense is that in the short run, inventories in the U.S. are quite strong, yet we see these oil-price movements,'' Raghuram Rajan, chief economist at the International Monetary Fund, said to journalists in Hanoi, Vietnam. ``Supply has to be an issue in the long run.''

U.S. crude-oil inventories gained 2.6 million barrels to 305.2 million last week, the highest since June, the Energy Department said yesterday. Gasoline supplies dropped 2.9 million barrels to 221.4 million last week, according to the department. The remain 11 percent higher than a year ago.

``With warmer weather, high gasoline inventories, and more OPEC production on the way, the price of crude is poised to fall,'' said Jason Schenker, an analyst with Wachovia Corp. in Charlotte.

``Irrational exuberance coupled with concern about supply has been driving prices higher,'' Schenker said. ``Although the price of crude should not collapse, there should be a return to more trend-like price increases.''

U.S. gasoline demand peaks between Memorial Day in late May and the Labor Day holiday in early September, when motorists take to the highways for vacations. About 10 percent of the world's crude oil is used to make the fuel for U.S. motorists.

To contact the reporter on this story: Mark Shenk in New York at mshenk1@bloomberg.net.

Last Updated: March 17, 2005 11:40 EST