London: Oil prices hit fresh peaks Wednesday, rising to highest since August 2008, buoyed by unrest in the Middle East and North Africa and dollar weakness ahead of an expected European Central Bank interest rate increase.

Brent crude rose $1 to breach through $123 a barrel at 1454 GMT, its highest since August 2008, and US crude rose to its highest since September 2008 above $109.15.

It gained 40 cents to $108.74 per barrel in midday trading.

The ECB is expected to raise interest rates by 0.25 per cent today in the first hike since the 2008 financial crisis.

The expectations have propelled the euro to a 14-month high while the dollar index was down 0.38 per cent at 1410 GMT.

"Central bankers will always claim that they have no influence on oil prices but recent history has repetitively shown that in the new world, where commodities are a global asset, central bankers can have a greater influence on oil prices than Opec," said Olivier Jakob from Petromatrix.

Members of the Organisation of Petroleum Exporting Countries said yesterday at a conference in Paris they could do little to control prices driven by speculators betting on "worst case scenarios" and said the market had all the oil it needed.

Prices have climbed for several weeks as the Libyan revolution forced the country to shut most of its exports, and energy traders worried about future supplies from the region.

Libya produced nearly two per cent of the world's oil, and an extended shutdown could threaten production ability of other Opec members that are covering some of the shortage.

Mohammad Bin Dha'en Al Hamili, UAE Minister of Energy, said Libya's production has traditionally been above one million barrels per day but this has now fallen to little more than 300,000 barrels. He said additional crude is being made available, but international oil markets are choosing to ignore market fundamentals.

"Markets always get nervous and volatile when faced with geo-political uncertainty, especially when this uncertainty is linked to events in the Arab world. It is therefore a good time to look at the facts in relation to the oil market".

He said there is little that can be done in terms of price control, which is set by international markets.

"However, by continuing to keep markets well supplied, we are making an important contribution to ensure that the global economic recovery is not adversely affected," he said.