It really is an oil bubble - 2 more data points...

When looking at the amazing increase in the price of oil lately and trying to determine if it represents the new real price of oil or an unsustainable and inflated price driven higher by speculators, it is worthwhile to look at what the "players", those in the oil business, say.

Here are two recent examples. The Wall Street Journal reports today on what OPEC has to say.

“Where is the demand going? It keeps going down. People need to look at that. Why would we produce more?” says Shokri Ghanem, Libya's top oil official. He said he believes the world market has enough oil. A Gulf OPEC official echoed that, saying the 13-nation group “will provide what the market wants. If customers aren’t asking for it, we’re not going to supply it. We don’t think more oil will lower prices anyway."

Hmmm...he seems to be saying that supply and demand not at work here. Well, let's see what a CEO of one of the world's largest companies, Royal Dutch Shell has to say from Saturday's Wall Street Journal -

“If you asked me why oil prices are so high, the answer would be “I don’t know,’” said Royal Dutch Shell PLC Chief Executive Jeroen van der Veer.

As Dinocrat observes: "The fellow makes quite a lot of money, and his company makes quite a bit more than that. You’d think as CEO part of the job description would be to have a view of why this was all happening."

Whether it's next month or next year, the oil bubble will burst.