Crude oil prices have climbed to roughly $75 a barrel, about triple the level of four years earlier, driven by a combination of geopolitical tension, limited refining capacity, rising demand, and speculative investment.
The standoff between Western nations and Iran over its nuclear program is a leading factor. Iran ranks as the world's fourth-largest crude producer, and analysts warn it could disrupt shipments through the Strait of Hormuz in a conflict. Separately, rebel attacks on oil infrastructure in Nigeria's Niger Delta have cut that country's exports by more than 20 percent since January.
Refining constraints are adding to the strain. No new refineries have been built in Europe or the United States in three decades, and gasoline inventories in the US fell 3.9 million barrels in a single week to 207.9 million barrels, continuing a six-week slide of 18 million barrels.
Global oil demand is forecast to reach 85.1 million barrels per day in 2006, a 1.8 percent increase, according to the International Energy Agency, fueled by strong economic growth in China and the United States. Most producing nations are already pumping at capacity, leaving only Saudi Arabia with meaningful reserves.
Speculation by hedge funds and pension funds has also played a role, though IEA director Claude Mandil said high prices stem primarily from an extremely tight market.
Historical summary. TurkishPress restated this wire report, first published in April 2006, in its own words.