Oil raced to a new record high above $125 a barrel on Friday, as a strong performance over the last week and a surge in heating oil futures saw investment funds trooping into the market.

Funds were keen to shift their money into the oil market after seeing U.S. crude rise about 13 percent since the start of the month, analysts say.

U.S. crude for June delivery rose $1.37 to $125.06 by 6:25 a.m. EDT (1025 GMT), after earlier hitting a record high of $125.12 a barrel.

London Brent crude rose $1.36 to $124.20 per barrel.

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"Funds are pouring into the crude market as prices have been performing extremely well," said Tatsuo Kageyama, analyst at Kanetsu Asset Management in Tokyo.

"Lingering geopolitical fears and high heating oil prices are helping the market, but the speed of the rise is too fast."

Gains in U.S. crude picked up momentum after distillate stocks in the United States, including heating oil, fell.

The U.S. Energy Information Administration (EIA) said on Wednesday domestic distillate stocks, which include heating oil and diesel, fell 100,000 barrels last week, to 105.7 million barrels, against forecasts for an 800,000-barrel rise.

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