What's the cause of $100 oil?

Maybe I'm too cynical, but I can't escape the feeling that these skyrocketing oil prices have as much to do with a lot of speculation and game-playing in the oil markets as anything else.

Of course we need to conserve, and of course we need to move as fast as we can to alternative energy supplies. That's a good idea if for no other reason than to protect the environment and shed our dependence on unstable Middle Eastern nations, as columnist Tom Friedman often points out.

But that doesn't mean we should be paying $4 a gallon, which now seems likely in the near future, when real supply and demand don't justify it.

I call your attention to this article from breakingviews.com in Thursday's Wall Street Journal. Some highlights include assertions that oil in storage tanks around the world is near all-time highs, below-ground supplies are abundant and production is increasing due to higher prices that encourage drilling while demand is slowing.

The author, Cyrus Sanati, also has detail on how speculators are "artificially boosting prices." He said it costs Royal Dutch Shell about $9 per barrel to bring a barrel out of the ground while the full cost of production is around $30 per barrel.

That's a pretty hefty markup, even allowing for other expenses. It's Happy Holidays indeed for your friendly oil industry executives, sheiks and day traders.