Guess what, it isn't demand in Asia. Supporters of the Bush Administration would like us to believe that, conservative Republicans everywhere would like us to believe that, but it ain't true.
There is a slow upward trend in oil prices due to increased demand, but that isn't the cause of this present mess.
So what is?
Can I quote McCain? "Bomb, bomb, bomb, bomb Iran! Bomb, bomb, bomb, bomb Iran!" Oil traders aren't stupid. They pay especial attention to the threats and bizarro schemes of Bush, Cheney, and McCain. The traders know that Iran is no pushover, and they will strike back through oil. Iran can seal the Persian Gulf, close off its own oil production, and even attack oil facilities in other Middle Eastern countries. Oil traders took note that the Bush Administration was trying to top off the US strategic reserves. They notice the similarities between the anti-Iranian rhetoric and the anti-Iraqi rhetoric before the Iraq War.
Then they hear a loudmouth member of the Israeli cabinet make statements about blowing up Iran, and Bam! the price of oil jumps skyward last weekend.
If the Bush Administration can bully the US military into launching an attack, there will be an attack. Except Rumsfeld is gone and the generals see the end of Bush. They see an overextended military in vulnerable positions in Iraq and Afghanistan. Even his own Defense Secretary will push back at Bush this time. If this last line fails, there will be war with Iran. That's a slim line, and the oil traders know it.
IF it holds. IF Obama wins the election in November, all this will be a bad dream by the end of next January. If, if, if.
I'm keeping my fingers crossed.