The geopolitical risk premium in oil has driven crude prices to nearly four-year highs and shows no signs of abating.
It's time to prepare for $100 oil. A price of $150, taking out the 2008 high, may also be a real possibility if events in the Middle East continue to escalate, as we have witnessed in recent days.
While I believe that oil, given the vast supplies available around the world, has an economic value of about $20 per barrel, it's becoming increasingly impossible to ignore a world that seems to want higher prices for crude.
Through a production agreement, OPEC and Russia have successfully offset the glut of crude oil being pumped every single day in the United States. Rising demand for oil in a synchronized global economic recovery has also helped bring supply and demand in better balance over the last year-and-a-half...