Oil to hit $100 by end of year and keep rising

Oil has been flirting with $80 a barrel and from the start of this year, I have been predicting $100 oil before the end of the year, when almost all other analysts were predicted between $40 and $60. I am not quite ready to declare that I was exactly right and they were wrong but it looks like increasingly so.

There are obvious and real underlying reasons for the escalating oil prices which we will expound upon below but news headlines have ruled the price of oil since at least 2004 and speculators can become unreasonably aggressive in riding the wave generated by the market. They exacerbate the situation.

There was no real rational economic reason for oil price to reach almost $150 a barrel (which for people with short memories may seem to have happened last century - it happened a year ago, in July) nor was there any reason for it to dip below $40, which happened right after late last year's "crises" - such as the economic crisis and the credit crunch crisis.