Today, a frigidcold snap has neighbors from Maine to Maryland shiveringunder a big chill and the price of crude oil is moving higher. With Jack Frost finally nipping at the Northeast, it makes sense to think its the cold weather pushing up the price, but that's only part of the story. There's more going on than meets the eye, and for the inside scoop CNBC asked "Fast Money’s" Eric Bolling, who is also one of the largest commodities traders at the NYMEX.
The price crude oil was moving higher mid-day and it looks like crude is going to end up having a good week, up about 5% or so “The arrival of the cold weather is helping crude," explained CNBC's Sharon Epperson but weather is only part of the story.
“We had been hearing all week long that we’re going to be colder than normal through about February 8th,” explained Bolling. He feels weather was already factored into the price. “The geo-politics of all the things going on (in Iraq, Venezuela and Nigeria), these are reasons the market is continuing higher.”
President George W. Bush has authorized U.S. forces in Iraq to take whatever actions are necessary to counter Iranian agents deemed a threat to U.S. troops or the public at large, the White House said Friday.
If Iran ignites, explained Bolling--you’ll see a $10 or $15 dollar jump in oil….you’ll have substantially higher prices if that sparks up. That would be a big problem for the oil markets.
China's Foreign Ministry said Friday that nine Chinese oil workers remain missing from an attack on their company's compound in Nigeria. Investors sometimes forget that “Nigerian crude is a very high yielding gasoline crude.” Bolling added.
On Friday, Chavez threatened to expel the U.S. ambassador over his insistence that the government fairly compensate investors when Venezuela nationalizes its largest telephone company. “We get a lot of product from Venezuela,” Bolling added “and that situation in Venezuela has been heating up now.”