It's Supply, Not Speculation

Tough talk today between Israel and other nations in the Mideast could be one of the reasons behind oil’s surge. Israeli Transport Minister Shaul Mofaz was quoted as telling an Israeli newspaper that an attack on Iran looks "unavoidable" given the apparent failure of sanctions to deny Tehran technology with bomb-making potential.

Combine the threat of more violence in the Mideast with increased demand from overseas and there could be real issues as growing countries take supply out of the market. “China alone could be as big an oil consumer as the U.S. by 2020,” says Tim Seymour.

“I remain bullish on emerging markets, but I’d also own downside protection,” he counsels, “especially in places such as Brazil that have run on high commodity prices.” My favorite markets are still Brazil and Russia and not China. And I’d be careful of frontier markets.”

“Because I expect emerging nations will raise interest rates to counter inflation I think the trade is emerging market currencies. Look at, Wisdomtree Dreyfus , or Wisdomtree Trust ,” he says.

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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; Seymour Owns (HAL)