(Updates prices, adds Wall Street outlook)

By Jeremy Gaunt, European Investment Correspondent

LONDON, May 21 (Reuters) - Oil stormed to new record highs above $130 a barrel on Wednesday, spurring fears of global inflation and undermining equities.

Wall Street looked set for a poor start.

A bullish economic outlook for Germany, meanwhile, helped the euro and deflated euro zone bond demand by strengthening views that interest rates would not be cut.

But equities took little comfort in the face of high oil and rising inflation pressures.

"The current inflation cycle is holding back markets and it's the commodities that are the major problem," said Arthur van Slooten, an equity strategist at Societe Generale in Paris, adding that SocGen does not expect a wage-price spiral.

New York crude CLc1 rose to a fresh high of $130.47 a barrel while London Brent crude oil LCOc1 also touched a new peak at $129.92.

OPEC added to pressure by reiterating its resistance to increasing supply to meet robust global demand.