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$150 By July 4?

Oil prices shot up nearly $11 to a new record Friday after Morgan Stanley predicted prices would hit $150 by the Fourth of July. The unprecedented jump is all but certain to drive gas prices well past the $4 mark in the coming weeks.

Oil's meteoric surge, which pushed prices more than 8 percent higher in a single day, added to a huge increase Thursday to cap oil's biggest two-day gain in the history of the New York Mercantile Exchange. The burst higher -- which also came on rising Middle East tensions -- also raised the prospect of accelerating inflation by adding to already strained transportation costs.

What does this mean for the stock market? For further insights we turn to strategic investor Dennis Gartman. Following is a synopsis of his main points.

What happened on Friday?

The oil trade has come unhinged, Gartman says. I am completely afraid to trade crude oil. I’ve doubled up on my nat gas stocks as a kind of hedge.

What’s gone wrong?

I think the floor itself has become de-populated, Gartman replies. Large traders who in the past might have taken the short side of the trade to create liquidity are simply not there. Everyone has pulled their horns in. There’s an illiquid market and Friday the news out of Israel and Iran as well as the Morgan Stanley $150 estimate created the perfect storm.

Does this increase the chance of government intervention?

You bet, he says. I have to think more government officials are looking at the $11 jump in crude and saying we have to do something.

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To see our entire interview with Dennis Gartman please watch the video.

















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Trader disclosure: On June 6, 2008, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Adami Owns (AGU), (C), (BTU), (GS), (INTC), (MSFT), (NUE); Finerman Owns (GS), Finerman's Firm Owns SPX Index Puts; Finerman's Firm And Finerman Own (HD); Finerman's Firm Owns (SUN), (TSO), (VLO), (MSFT), (AAPL), (NYX),(PPH),TIPs; Finerman's Firm And Finerman Own (C), (C) Leap; Finerman's Firm Is Short (IYR), (IJR), (MDY), (SPY), (IWM), (BIG); Macke Owns (WMT), (INTC), (MSFT), (DIS); Najarian Owns (AAPL), (BHI), (CHK), (HD), (HPQ), (TSO), (XLF), (NOK), (AMLN), (ENER); Najarian Owns (LEH) Puts; Najarian Owns (NUE) Calls, (AA) Calls

Gartman Owns (DIS), (AAPL), (ADBE), (AMR), (EWC), (PGH), (SJT), (PLL), (CQB), (JJG); Gartman Is Short (BAC), (WFC), (ICE), (CME), (XOM); CIBC Gartman Index Owns Natural Gas, Gold, Corn, Soybeans, Copper; CIBC Gartman Index Owns EUR, Yen, Canadian Dollar, Canadian 10 Year Note, EUR STOXX 50, HK Chinese Stock Index; CIBC Gartman Index Is Short Crude Oil

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