today the cause is tension between israel and iran:
Quote:
Oil Near $143 on Israel - Iran Tensions
By REUTERS
Filed at 7:35 a.m. ET
LONDON (Reuters) - Oil rose more than $3 a barrel on Monday to a new record above $143, propelled by heightened market fears of conflict between Israel and Iran over Tehran's nuclear program.
A fall in the U.S. dollar to three-week lows versus the euro helped boost the market.
U.S. light crude was up $2.55 at $142.76 a barrel by 7:12 a.m. EDT, after a record high of $143.67 a barrel.
London Brent crude was up $2.76 at $143.07.
"The U.S. dollar is down and there are many high-level geopolitical news items, particularly in the Middle East, that are pushing prices up," said Mark Pervan, a senior commodities analyst at the Australian & New Zealand (ANZ) Bank in Melbourne.
Iran's Revolutionary Guards have said Iran would impose controls on shipping in the Persian Gulf and Strait of Hormuz if it were attacked.
The Strait of Hormuz, a narrow waterway separating Iran from the Arabian Peninsula, accounts for roughly 40 percent of the world's traded oil flows.
Iran's foreign minister said on Sunday he did not believe Israel was in a position to attack his country over its nuclear program.
SUPPLY CONSTRAINTS
Oil prices have jumped more than 40 percent this year, extending a six-year rally, in response to Middle East tensions, plus expectations that supply will struggle to keep pace with rising demand from emerging economies such as China and India.
Concern over long-term supply constraints have also pushed up the forward price of oil. Oil is currently priced between $135 and $139 a barrel out to December 2016.
The market, as a result, is sensitive to any supply disruptions.
A succession of militant attacks on Nigeria's oil facilities that have shut a fifth of the country's output since early 2006 has helped drive the market higher.
A flood of cash from investors seeking alternatives to sagging global equity markets and to hedge against inflation has also contributed to oil's rise.
"Demand from the investment side has been boosted by problems in the financial sector as well as a desire for diversification," said Frances Hudson, investment director, strategy at asset manager Standard Life Investments.
"Also, inflation concerns encourage investment in real assets such as oil and gold."
Some have blamed investor flows into oil or so-called speculative money for the market's rapid climb since the start of this year, others say it is more to do with the tighter balance between supply and demand.
Tony Hayward, chief executive of international oil company BP Plc <BP.L> said: "This is a fundamental signal, this is not about speculation."
The market will watch U.S. economic indicators due later on Monday as well as the European Central Bank's interest rates decision on Thursday for further guidance on the U.S. dollar.
(Additional reporting by Fayen Wong; editing by James Jukwey)
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http://www.nytimes.com/reuters/busin...=1&oref=slogin
of course, and more than you may think, the bush people have been busy busy busy little bees in iran. this long piece from the new yorker.
it really should have its own thread, but it's long and works here too:
http://www.newyorker.com/reporting/2...7fa_fact_hersh