Increased demand.
Are Chinese citizens buying more cars?
Yes.
Driving that much more?
Yes.
Is China demanding crude to feed its thriving petrochemical plants?
Yes
When did THAT industry come into being in China?
Recently.
I'm sorry, but the only way I can buy the Chinese demand explanation is to believe that China is buying up reserves against a day when they want to go to war.
Well, they are also buying excess reserves as well.
And if they were going to do that, I would have thought it made more sense to buy it at $30 a barrel rather than $55.
The price of oil is the price of oil. If there was no economic boom, then oil wouldn't be so high, but then China wouldn't have the dough to buy oil at these prices.
They have been raising prices by fits and starts for the past 30 years. It wasn't all that long ago that I shuddered at $1.20-a-gallon gas. And 10 years ago, gas over $1 a gallon wasn't common. So the answer is, they DIDN'T wait until now to raise prices; they DID raise them 10 years ago. And 5 years ago. And 1 year ago. And last week.
That's just not true. Adjsuted for inflation, gas prices have been going up and down for the last 30 years. If they had total control over prices, you would have seen a constant increase over the last 30 years, which is not the case.
And nobody has offered a believable explanation.
It's called supply and demand.
First of all, "adjusted for inflation" is deceptive, since rising gasoline costs are a major contributor to inflation. Secondly, while gas prices haven't gone up STEADILY for the last 30 years, they have gone nowhere but up. Nowhere on earth are you paying LESS for gasoline today than you were 30 years ago. Or 10 years ago. Or 5. Gasoline tends to increase in price dramatically rather than in small increments, but it has risen inexorably for the last 30 years.
It's called supply and demand.
The Chinese are not driving so many more cars that it would account for this dramatic an increase in crude demand. And no petrochemical industry arises overnight. In fact, the oil companies assure us that constructing a refinery takes centuries and costs billions and billions of dollars. So an emerging Chinese petro industry doesn't ring true either.
I'm not entirely ignorant of the laws of supply and demand. I just don't see that as a satisfactory explanation of this phenomenon. On the other hand, monopoly serves to adequately explain almost all of what we're seeing in the oil industry today.