"In the actual physical market for oil, nothing changed between yesterday and today," said Judy Dugan, research director of Consumer Watchdog. "Morgan Stanley knew full well that making the prediction would spike prices, especially by calling for $150 oil in less than a month. As for the Israeli statement, traders instantly grabbed it as a reason to spike prices, even though it appeared to be a calculated warning, not a signal that bombers are about to take off. Obviously, diplomatic nuance means nothing to speculators."
Early in the day, a smaller price rise in crude oil was blamed on a weaker dollar and oil demand in Asia. But, said the nonprofit, nonpartisan Consumer Watchdog, ever-bleaker economic news in the U.S., including rising unemployment, should have pressed the price downward.
"The bottom line of this oil price feeding frenzy is that drivers in the U.S. are likely to suffer $4.50 gasoline, while in California and some other states may hit $5.00 a gallon for regular this summer," said Dugan. "Inflation will keep spiking the price of groceries as well as gas. Congress and the White House have to stop talking and put some emergency regulations on trading markets, including electronic markets that are completely unregulated."
