Oil price 'may hit $200 a barrel'

The price of crude oil could soar to $200 a barrel in as little as six months, as supply continues to struggle to meet demand, a report has warned.

Goldman Sachs energy strategist Argun Murti made the warning as benchmark US light crude passed the $123 mark for the first time.

Surging demand was increasingly likely to create a "super-spike" past $200 in six months-to-two years' time, he said.

Oil prices have now risen by 25% in the

last four months and 400% since 2001.

US sweet, light crude hit an all-time peak of $123.53 (£63.25) on Wednesday, while London Brent crude jumped to $122.32.

Mr Murti correctly predicted three years ago - when oil was about $55 a barrel - that it would pass $100, which it reached for the first time in January of this year.

Chinese demand

Soaring global demand for oil is being led by China's continuing economic boom and, to a lesser extent, by India's rapid economic expansion.

Both are now increasingly competing with the US, the European Union and Japan for the lion's share of global oil production.

This additional demand comes at a time of continuing production problems in a number of oil-producing nations.

Production is down in Nigeria after the latest attacks on pipelines this week by anti-government militants, while Iraqi exports through the north of the country have been hit by renewed cross-border raids by Turkish forces against Kurdish insurgents.

Oil prices are also rising as the key US summer driving season approaches.

Economists warn that continuing high oil prices will impact on the global economy, hitting growth and fuelling inflation.

Serbia poll fuels Kosovo tension

Serbia is holding an early general election on Sunday - and 300 polling stations will open in Kosovo, despite the declaration of independence in February.

The Serbs insist that Kosovo is still part of Serbia, and that no-one has the right to stop them flexing their democratic muscles.

The Kosovan government and the UN mission in Kosovo protest that only the UN has the right to organise local elections in Kosovo - and will not recognise the results. But they have pledged not to stop the elections taking place.

"Kosovo is an independent state and we act according to that position," deputy prime minister Hajredin Kuci told the BBC.

"Unfortunately people in Serbia, especially the government of Serbia, are trying to use Serbs in Kosovo not as a bridge for co-operation between Serbia and Kosovo, but as a movement for the integration of Kosovo into Serbia...

"In any case, we will not give them the chance to build up new institutions according to the result."

But that is exactly what the Serbs intend to do.

"These elections are important for us for many reasons," said Jovan Stojanovic, a candidate of the Movement for the Survival of Serbs, in Caglavica.

"For the first time in nine years (since Nato replaced Serbian security forces in the province in 1999) we are going to choose legitimate local representatives."

Displaced communities

One of the many strange features about this election is that they are being organised according to the old, pre-1999 municipal boundaries.

So Mr Stojanovic is standing for a position on the Pristina city council, which will sit in exile in Gracanica - a parallel institution to the Albanian city council of Pristina elected in the Kosovan local elections last November. Kosovan Serbs boycotted that vote.

"In the local elections we're choosing people who will organise all the main areas of our lives," said Zvonimir Stevic, candidate for the Socialist Party of Serbia in the same region.

"They are the people who will represent us in negotiations with the international community, and with our neighbours the Albanians as well."

Many Serbs in Kosovo's enclaves say that whatever the disagreements over the territory's status, whether it is now independent or not, it is high time Albanians and Serbs sat down and solved the real problems together - local problems like the daily power cuts, rubbish collection, water supply, sewage.

Serb refugees from Kosovo are being encouraged to vote for the council of the town and village they fled from.

There are only a few hundred Serbs still living in Pristina. But there are around 6,000 Serbs displaced from Pristina on the voting register in central Kosovo, and a further 25,000 Serbs from Pristina now living in Serbia who can vote for the Pristina city council.

Deepening split?

Another oddity is that Albanians who fled to Kosovo from the Presevo Valley in southern Serbia in 2001, and now live as refugees in Kosovo, are being encouraged to cross back into Serbia this weekend, to vote for ethnic Albanian parties standing in the Serbian election. They currently have only one deputy in the Serbian parliament. Special buses are being laid on for the Albanians to go and vote in Serbia.

No one appears quite sure what happens when the voting dies down.

The biggest challenge to Kosovan independence would come if an idea put forward by Marko Jaksic, a prominent Serb nationalist standing for the Serbian Radical Party in northern Kosovo, is adopted by the new government in Belgrade.

He has proposed the formation of a Serbian parliament in Kosovo, made up of those elected this weekend. "Serbs in Kosovo need a representative body through which they will realise their legal and legitimate rights," he told the Reuters news agency this week.

In Pristina a rally against the Serbian elections, organised by student leader Albin Kurti's Self-determination movement, passed off peacefully on Friday.

Participants dumped rubbish outside the government building, to demonstrate their anger at what they see as the failure of both the government and UN mission to prevent the Serb voting.

They say the elections will serve to further partition Kosovo into Serb and Albanian areas, and will strengthen Serb ties to Belgrade, while weakening and undermining their ties to Pristina.

Olympic flame lit at Everest peak

Chinese climbers bearing the Olympic flame have reached the summit of Everest, the world's highest mountain.

Chinese television showed the team of climbers, carrying special high-altitude torches, reaching the summit at 0920 local time (0120 GMT).

Huddled in the snow they unfurled flags and cheered for the cameras.

Correspondents say China is hoping the dramatic feat will counter some of the damaging publicity from the protests during the torch's international relay.

Perfect conditions

The team - made up of both Tibetans and Han Chinese - set off several hours before dawn from their camp at 8,300m.

Everest Olympic torch diary Nepal lifts Everest ban

Low winds and a clear sky provided perfect climbing conditions for the six-hour ascent of the 8,848m (29,030 feet) high summit.

At the weekend heavy snowfall had prevented a previous attempt, and badly damaged several of the high-altitude camps.

The climbers, dressed in red padded anoraks bearing the Beijing Olympic logo, passed the flame between several torches as they traversed the icy slopes on the final steps to the summit.

Holding up Chinese and Olympic flags, they cheered "Beijing welcomes you!" and "One World, One Dream", the official slogan of the Beijing Olympics.

The first and last of the torch-bearers were Tibetan women.

CHINA RELAY CITIES IN FOCUS Use the map to see the full Olympic torch relay route or read about some of the key cities: Full route map, Hong Kong, Guangzhou, Xiamen, Jinggangshan, Shanghai, Nanjing, Huangshan, Three Gorges, Kaili, Lhasa, Urumqi, Xian, Yanji, Weihai, Qufu, Anyang, Beijing.

"We have lit this torch on the top of the world for harmony and peace," said one of the mountaineers.

Security was very tight for the event, with other climbers being banned from the top of Mount Everest, which is known in China as Mount Qomolangma.

Both China and Nepal sealed off their sides of the mountain and the ascent organisers kept the exact plans a secret because of fears it might draw protests from pro-Tibet activists.

Human rights activists have been angered by the crackdown on anti-Beijing protests in Tibetan areas of China in March that turned violent.

The main Olympic torch, which is running separately, is continuing its relay through China.

It was carried through the southern city of Guangzhou on Wednesday past cheering crowds with no reports of disruptions.

It is scheduled to visit every province in China before arriving in Beijing several days before the Olympics begin on 8 August.

The international leg of the torch's tour was marred by protests in several cities - including London, Paris and San Francisco - by activists critical of China's human rights record.