Apparently the Saudis have targeted around $100/barrel as the price for oil. Presently the price of oil is around $110/barrel. In addition, the political break even prices of oil (i.e. the price at which oil revenues allow business as usual for the governments of mostly oil revenue-dependent nations) have been rising substantially as well. Whatever you take this as a sign of (e.g., Peak Oil, export land model, or socialism eventually running out of other people's money), the take away is pretty clear. Expect the prices of oil and gasoline to continue to rise, even without a major incident in Iran, which is hardly out of the question. I'd also not be surprised to see a purely political release of oil from the Strategic Petroleum Reserve, probably close to the summer, in the attempt to keep gas prices in the US from rising towards that magic $4 number that my gut tells me is the doom of one Barrack Obama's reelection hopes.
Foundationalism: in praise of vagueness
2 days ago