Why Oil Has Risen From $75 To $100 In Six Weeks
By Monty Guild
1.The lack of productive diplomacy between the U.S. and Middle Eastern nations has frightened some former “friends” in the oil-producing world, and turned them at best neutral, and at worst, cold to America. They have watched fellow Arab regimes tumble in Tunisia, Egypt, and Libya and witnessed the uncertain role of the U.S. against Qaddafi as a peripheral – and not a leading – effort. Should their regimes come under attack, they wonder whether Washington will stand with them or against them. In recent months, Saudi Arabia has quietly reduced its crude output, even as prices have risen. Perhaps this has something to do with the belief that the U.S. will not step forward in case of trouble, even though the Saudis are major oil suppliers.
2.Iran’s aggressive behavior in the region has made the practice of stockpiling some oil a wise bet.
3.Global investors read weather reports. Now that the season of revolt-discouraging 130 degree temperatures have passed, investors wonder about a possible resumption of the “Arab Spring” and further instability in the region.