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  • Will Spiking Oil Prices Tank the Economy?

    Our economic recovery was already fragile, to say the least, and now we have crude oil prices over $100 per barrel in less than two months. So what are the risks that the economy will head back into a double-dip recession? Today we look at the latest economic reports which hold mixed signals for the economy going forward, and what leading economists expect in light of $100+ oil prices.

    Following that, I will discuss the possible ramifications of the latest political turmoil in the Middle East. Thus far, the impact of political change has been marginal. But what happens if Saudi Arabia, the world's largest oil exporter, falls prey to a regime change? Could it really happen? Only time will tell, but if the Saudi government falls, expect all hell to break loose in terms of oil prices.

    And finally, I address once again the subject of whether "speculators" are the main cause of spiraling oil prices. Speculators are only an ancillary cause of rising oil prices, with marginal effects. The real cause of higher oil prices is the fact that political unrest in the Middle East and North Africa has escalated significantly over the last couple of months. No more, no less.