Sources blamed the usual suspects (Iran and Nigeria) for the $10 spike in oil prices. (Just for fun, perhaps, there is an extra rumor out today, that of Israeli warplanes practicing for a strike on Iran from US bases in Iraq.) AP:
Oil prices spiked Friday as continued tensions in the Middle East and concerns of renewed violence in Nigeria pushed the price for a barrel of oil to a record near $147…JBC Energy in Vienna, Austria, said the news about Iran, Nigeria, as well as a reported threat of a strike by oil workers in Brazil were “enough to wake the market from its two-day slumber.”
In addition to the rather gleeful traders and speculators that adorn CNBC these days, cheering for $170 oil, it seems likely that the oil producers themselves are gaming the futures market. They no doubt think that the oil futures market is the Philosopher’s Stone of the 21st century. In medieval alchemy, the Philosopher’s Stone was said to turn lead into gold; today OPEC leaders turn their own hype into outrageous profits.
The worthies of OPEC produce the oil, and then, through the futures market, can turn the oil into gold, magically doubling its price over the past year, though global demand has stagnated. So far they have been successful. At some point the old excuses for price rises could cease to be plausible, possibly all of a sudden. We keep waiting — but the sad and salient fact of this situation is that it America’s own damned fault to be at the mercy of such businessmen, speculators and enemies by permitting imported oil to be 70% of America’s supply as opposed to just 24% three decades ago.
Oil prices will probably double tomorrow after this Iranian missile test is publicized.