All Oiled Up, Bend Over...Yet Again

Oil shot up to $108 a barrel today on continued unrest in the Middle East and North Africa (the new acronym for the region is MENA) as this time Yemen looks like it's on the brink of government collapse, and on Friday's job numbers here in the US.

Oil climbed for a third day in New York as signs of a strengthening U.S. economy stoked bets fuel demand will rise in the world’s largest crude user.

Futures advanced as much as 0.7 percent to a 30-month high after an April 1 report showed the U.S. added more jobs than economists forecast last month. Prices advanced 2.4 percent last week as fighting in Libya between rebels and forces loyal to Muammar Qaddafi threatened to prolong supply cuts from Africa’s third-largest producer.

“The U.S. data paints a positive picture,” Jonathan Barratt, managing director of Commodity Broking Services Pty in Sydney, said by telephone today. “People are still concerned about Libya, but not overly. If Qaddafi decides to call it a day, then there will be a short, sharp sell-off.”

Crude for May delivery gained as much as 80 cents to $108.74 a barrel in electronic trading on the New York Mercantile Exchange, the highest since Sept. 24, 2008, and was at $108.52 at 3:13 p.m. Singapore time. Prices are up 25 percent from a year ago.

Payrolls advanced by 216,000 workers in March compared with a 190,000 gain projected by economists in a Bloomberg News survey. The jobless rate dropped to 8.8 percent from 8.9 percent, the fourth straight decrease, the Labor Department said. The unemployment rate was projected to hold at 8.9 percent, according to the median forecast in the survey.

As the summer driving season gets closer, we've seen gas prices jump 60-70 cents a gallon in roughly six weeks.   Now that there's open war in Libya, that's only going to go up.  We're only another 60-70 cents per gallon away from record nominal highs in gas prices, too..and I'm fairly sure we will break that this summer.