joe sod said:
That's not my understanding of the issue. Politics (i.e. to the extent that the terror campaigns in the Middle East and elsewehere can be termed 'politics', and indeed the US intervention in the Middle East can be termed 'politics') are playing quite a big role in the current price of oil. And nature (as evidenced by Katrina and other recent inclement weather conditions in the Gulf of Mexico) is also having a negative effect.
I agree that there probably isn't enough oil to satisy current demand at prices we've been used to, but I believe that there is probably enough oil to supply us at prices lower than we have experiencing in the past six months or so.
As mentioned above, hedge funds are having an impact, as are disruptions to supply caused by nature, as are concerns about future disruptions to supply as a result of terrorism. The last two aren't/won't necessarily cause supplies to fall per se, but rather will result in delays in moving supplies from oil producing nations to consumers.