$90 Oil with 17 % real unemployment (U6) means recession.
Oil prices have to come in soon. If they hold here, or worse, head higher, it means Peal Oil (and Peak Imports) is here, with all of its attendant issues, in my opinion. The simplest explanation is usually best.
Like any rational trader I spend nearly all my time feeling like a guy balancing on the back 2 legs of a chair, almost falling backwards, and then catching himself. You know that feeling... I feel like that ALL the time...
There is NO WAY producers can pass costs onto the consumer... especially when higher energy costs are emptying out the consumer's wallet... this does not have to be the case in the Oil market... Oil price is likely an equilibrium indicator, as their are no substitutes for the most part and the supply appears to continue to contract... how this all works out still depends upon the rate of change more than total change (I think).
House prices continue to contract while silver continues to soar... Food prices have risen even though percentage of people that cannot afford to pay for them has increased dramatically... Our leaders are willing to go further into long term debt in order to fund today's unemployment compensation.... these statistical anomalies will only get much, much worse if Oil prices rise further (and Peak Oil is here).
Oil is at its absolute resistance point. If it breaks thru it, look for much higher prices. If not, look out below. I am long, but like the guy balancing on the back 2 legs of that chair, I am always thinking about not crashing in a heap on the floor.