Oil hit a new record at $124 a barrel today.

until we deal seriously with the demand side of the oil equation (e.g., the side the United States can actually do something about).

I have passed a couple of Shell stations in Richmond recently with Diesel at $4.29.  Regular was about $3.65, still shocking and heading up.

I just paid $4.40 per gallon for diesel. Fortuately, I get great mileage and don't drive that much any more.  I really feel for those who must visit the pumps every week in order to get to work...

I luckily don't drive much at school.  So last time I filled up was about a month ago in Williamsburg, gas was $3.20, which I thought was annoying because I was always happy the year before when at home (McLean) gas was 3.15 while in Williamsburg it was 30 cents cheaper.

Today I got home, went to the gas station in Tysons.  $3.77 a gallon - ugh.  Not Arlington but... still...  I earnestly worry for the economy (but I'm still holding out hope this will make a difference in our green investments.

I saw $4+ gasoline in a well-to-do part of Alexandria.  That was the first I'd seen.

And for all those Virginians whining about our taxes, on a recent road trip I topped off in Ohio and they had stickers on all the pumps: 44.4 cents per gallon gasoline tax.  A dime more gasoline tax in Virginia to address our dire transportation needs would still put us more than 15 cents less than Ohio.

Seeing how the word "recession" has now been hikacked from economic terminology and now is a staple in political framing the reality is we are NOT in any real kind of recession if people are still willing to pay 4 bucks a gallon without outrage.
The only real protestors have been the truckers during this rise in prices. How can the country seem willing to plod right along with the escalation of prices if we were truly in a real recession.
Fact is people have the money and are willing to pay for it and the money has been a product of the economy. There are more small business owners in Virginia today than ever in its history contributing to the jobs and Virginia's economy and the growth of commercial mixed use communities throughout Virginia continues.
Prediction of $152 a barrel by the time the kids return to school in September and taking a look at the sales figures for back to school may show us how thin this recession speak really is for consumers.

Yesterday's paper said there is no shortage of supply, so supply and demand is not to blame.  There is plenty of refining capacity, so even though the mergers during Cheney's reign resulted in closing some refineries, that is not the problem.  It appears that speculators are the only cause left to explain the price explosion.

I'm old enough to remember when the Hunt brothers (also of Texas, home of the oil men disliked by Eisenhower)tried to corner the silver market.  Is someone trying to corner the oil market?

I'm not saying we don't need to get off our dependence on oil ricky-quick; what I am saying is I think there is a heck of a lot more at play than the so-called "free market." A funny smell comes my way when I watch the "analysts" on TV explain what has happened and what will happen.

in the sense that there are no lines at gas stations or anything like that.  However, what we've got right now is a vertical supply curve, or even -- as George Soros said the other day on Diane Rehm -- a "backward bending" supply curve. What that means, in English, is that supply is constrained, so that an increase in price either results in the same or even LESS oil production.  Now, I don't buy the "backward bending" curve concept, but I DO believe we are close to vertical right now in the short term.

Now, I'm not arguing - nor are my former colleagues at the Energy Information Administration - that it's ALL "supply and demand." There's also a "risk premium," an "anxious market," investment flows, the depreciating dollar, etc.  All of these other factors could certainly be responsible for $30 or $40 per barrel, in my opinion -- in other words, the surge from $80 to $120.  But beyond that, I'm sure that the vast majority of energy economists would agree that oil prices are being driven by two main factors:

1. Surging world oil demand in China, India, the Middle East, etc. the past few years.

2. The vertical supply curve I mentioned above (also, very little spare production capacity).