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The rise has been sudden and dramatic. Early this year a lone trader in New York pushed the price of oil above $100 a barrel for the first time, taking the world into a new era.

It did not last, sparking suggestions that the trader had ensured his place in history but very little else. Then, a few weeks ago, the upward march began again. Last weekend, with oil markets twitchy about the closure of the Grangemouth refinery in Scotland and a dispute affecting Nigerian oil output, prices came within a whisker of $120 a barrel.


The president of the Organisation of Petroleum Exporting Countries (Opec), the Algerian energy minister Chakib Khelil, helpfully added to the mix by suggesting that the price could hit $200 as investors fled the weak dollar.

As it turned out, prices spent much of last week slipping back, dropping to just above $110. But on Friday they were up again, responding to Turkish airstrikes on Kurdish rebels. Oil is a great barometer of international tension.

Is the head of Opec right about a $200 oil price? Will a more realistic target, $150, be reached this year and what would be the consequences of that for the economy? Why has oil been surging anyway, doubling in price in a year?

Times of London