Iran report pushes oil to new record...

Oil prices near $127 a barrel on report about Iranian output; Oil prices shot to a new record near $127 a barrel Tuesday on concerns that Iran may consider cutting crude oil production.

Traders were reacting to news reports that Iran's government is considering cutting crude oil production. In later news reports, Iranian officials denied that production cuts were imminent, but said a reduction has been discussed.

Iran, OPEC's second-largest oil producer, more than doubled the amount stored in tankers idling in the Persian Gulf, as demand for some of its crude fell, this is a direct cause of the crude prices, if the prices don’t come to acceptable levels below $100 then the situation for producers and oil companies and in general will become worse.

Retail prices aren't going to decline as long as any part of the energy complex is heading higher.

In sending crude prices higher Tuesday, investors shrugged off the dollar, which strengthened against the euro Tuesday. A stronger dollar often prompts selling by investors who had bought commodities such as oil as a hedge against inflation. Also, a stronger dollar makes oil more expensive for investors.
Meanwhile, the International Energy Agency, an adviser to mostly western, industrialized nations, said high prices are cutting demand for oil and petroleum products in the U.S. and Europe. The IEA cut its global oil demand growth forecast for this year to 1.2 percent from 1.5 percent. In the U.S., the IEA said demand for oil may contract by as much as 2.1 percent this year, while demand for gasoline will drop by about 1 percent.

Energy investors are also concerned about China, which recently reported a drop in crude imports. Analysts were uncertain whether Monday's 7.9-magnitude earthquake in central China would have a significant impact on demand. The quake killed about 10,000 people and knocked power plants and other factories off-line. Strong demand from China and other fast-growing economies has underpinned oil's rise in recent years.
So all points to less world crude demand but SPECULATION will not allow the prices to reach normal values below $100, a recession in most crude exporters can now be expected, we have Venezuela as a example were food shortages are a daily routine...