British Petroleum (BP) Chief Executive John Browne has warned that fear was driving the price of crude to artificially high levels, Guardian reported on Wednesday.

Turbulence in Iran, Iraq and Nigeria was leading to continual speculation about oil shortages and there were "all sorts of things that suggest it is getting worse," the BP chief executive said on Tuesday.

Guardian said higher oil prices helped BP produce underlying profits of 5.3 billion U.S. dollars in the first quarter, an increase of 7 percent, but Browne said global supply and demand for oil was moving towards balance.

"I was at Doha at the weekend. Most (energy) people are not happy that the price of oil is so high because it is so unexpected and no one is quite clear what the impact will be," the UK's leading oil man said.

Other BP executives hinted that hedge funds and other speculators were partly responsible for the current record levels of 73 dollars a barrel.

It is said that there had been a massive increase in the number of financial institutions trading in the oil markets.

The oil company privately fears that unusual periods of very high crude prices and huge profits will spark a public backlash and encourage politicians to slap on more taxes.

Browne said that BP's taxes had already risen this year to 35 percent and would rise to 39 percent after a new North Sea tax comes into force.

BP said UK petrol had provided only the smallest financial contribution, but it admitted North Sea oil and gas had been very profitable.

Browne rejected suggestions that British gas consumers were paying for the company's financial success and hotly denied accusations that the company had not landed as much liquefied Natural Gas as it could have done.

The company also came under fire from environmentalists at Friends of the Earth for not spending enough on safety.

Source: Xinhua