Crude oil and corn prices surged to record highs on Friday as the world’s hunger for fuels continued to convulse the energy and agriculture markets.

The rise in oil prices to a record of $126.2 a barrel – double the level of a year ago – was the culmination of a stunning week in which prices jumped by $10, stoking fears of higher inflation in spite of lower economic growth.

A year that began with people asking whether oil prices would finally reach $100 a barrel is seeing some traders already betting on when it will hit $200.

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The jump in oil prices is also driving up the use of agricultural crops such as corn and soyabean for biofuel, exacerbating food inflation and aggravating shortages across the world. ...

Corn prices rose to a record record of $6.27 a bushel, up 75 per cent in the past year. Some analysts warned that corn could hit $7 a bushel this year, raising the cost of meat and dairy products because the grain is used as agricultural feed.