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Oil Prices Hit New 14-Year High

Traders continue to worry about supply after last week's attack on oil workers in Saudi Arabia.

Updated from 2:35 PM EDT

Oil futures closed at another new 14-year high Tuesday as security worries in Saudi Arabia helped push prices close to $39 a barrel, a level not seen since October 1990.

Light sweet crude for June delivery closed 77 cents, or 2%, higher, at $38.98, the highest since Oct. 16, 1990, when Iraq occupied Kuwait. Prices traded as high as $39.14 a barrel in regular trading on the New York Mercantile Exchange. Prices also closed at a near 14-year high Monday.

The latest spike comes in the wake of the May 1 attack on foreign oil workers in Saudi Arabia that left five dead and prompted U.S. Ambassador James C. Oberwetter to urge Americans living near the site of the shooting to leave the country. Saudi Arabia's interior ministry later identified the mastermind of the attack as a Saudi dissident living in London.

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As political and security risks heat up in the world's largest oil exporting nation and major U.S. supplier, future oil prices will feel the effect of the attack in Yanbu, a Red Sea industrial city.

"Prices remain sticky and high," said Bob Brusca, chief economist at Fact and Opinion Research in New York. "It's not good."

He said security issues created an all-or-nothing sensibility in price forecasts, and that would likely continue. "Either it is or it isn't" safe for foreign workers in Saudi, he said. Last year, a pair of bombings in Riyadh killed more than 40 foreign workers.

Saudi Arabia had an average daily output of 8.4 million barrels of oil in March.

Oil prices first closed near a 14-year high in mid-March, then crept back down.