Speculation was also a big part of the rise in 2008 as well. After the economic meltdown it crashed into the low $30s. So what is the "correct" price of oil today given the real supply and real demand? I would say between $60-80/barrel. Saudis know this and announced over the weekend they are cutting production. (Whether this is real or their fields are dropping more than they are letting on is debatable).
Speculators have used the ME unrest this time around to bid up the price. Last time it was expected global demand, artifically raised somewhat by China and their controlled economy. They wanted a spectacle and to show the world they have arrived with the Beijing Olympics. When we were there in 2006 the number of construction projects in the city was incredible. You could look in any direction and see 30 of the huge construction sky cranes. They basically rebuilt that city and made sure the entire coast was factory after factory down to Shanghai. When China crashes, it will crash hard. They have something like 60 million empty residences, built and bought on speculation. They have massive overcapacity in production capabilities, and have used some of their reserves to stockpile tons of industrial metals. If China ever decided to turn within themselves and revert to their traditional isolationist stance, places like Australia which supplies those metals are completely gang raped.
It is not just oil. Corn, lead, copper, & silver are currently near or above all-time highs.
1985 Honda VF1000R, 1990 Ducati 851, 2008 YZ450F