There are many causes for oil prices surging to near $100 a barrel.China and are voracious new consumers driving up demand, and fear of supply interruptions — principally from conflict between the United States and Iran — might be adding as much as $30 to the price. The falling dollar also makes oil more expensive.
...Notably, all this activity is being driven not by the occasional basket of favors to key lobbies that Congress passes and rebrands as energy legislation, but by the behavior-altering reality of higher energy costs.
...The reality is that $96 oil will accomplish more than all of the energy bills passed in the last generation combined. Painful, yes. Troubling, absolutely. But perhaps the only force powerful enough to alter the way America fuels its economy.
Think of $96 as $40 oil (which is about what it cost three years ago) plus a tax of about 140%. Had any public official dared to propose such a steep tax, he or she would have been run out of office. But its revenues would have gone to fund services in the USA. Now much of it goes to foreign governments, with some of it being shared with oil companies, related industries and oil traders — at least those smart or lucky enough to bet on rising prices....MORE