Drill Baby Drill! | Foreign Oil Import Costs Will Collapse US Economy

Saudi Arabia Uprising Could Mean $140-Plus Oil


John Melloy|CNBC

Catch 22: What are you going to do when you have to choose between food and fuel? Whether you're a liberal or conservative, everyone has to drive to work and earn a paycheck. Now is the time to concentrate on domestic oil production. This will create jobs, boost the economy, and ease the pressure of reliance on foreign oil imports. The US shouldn't be protesting budget cuts, but rather protesting Obama's imposed drilling moritoriums.

The events unfolding in Libya mark the first uprising in a major oil producing country this year, giving energy traders their first indication of where crude could climb if Mideast turmoil were to spread to Saudi Arabia or Iran.

“Pricing in Libya supply disruptions is one thing, but what if this social unrest spreads to Saudi Arabia, which holds 20 percent of the world’s oil?” said David Rosenberg, chief economist and strategist for Gluskin Sheff. “Do the math: we’d be talking about $200 oil.”

Without taking into account the collateral effects of such a strategic part of the Middle East falling under siege by its own people, a simple production comparison gets the price to at least $140 a barrel.

West Texas crude oil for April delivery, the benchmark for the U.S., rose as much as $8.44 a barrel in trading today to $98.48 on Libyan Leader Muammar Gaddafi’s defiance in the face of the uprising.

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