220S

...for high prices at the pump. XOM stock shares are at the highest they've been since 2008.

NEW YORK | Mon Jan 31, 2011 4:47pm EST

NEW YORK (Reuters) - Brent crude topped $100 a barrel for the first time since 2008 on Monday, jumping more than 1 percent on unrest in Egypt and rising demand expectations.

Egyptian President Hosni Mubarak overhauled his government in an attempt to defuse a popular uprising that has raised concerns about oil shipments through the Suez Canal and a key pipeline running through the country.

The surge in Brent, which has climbed from $70 a barrel in August on rising global demand, has also stirred worries in consumer nations that a hike in fuel prices could stall a global economic recovery.

Officials from the Organisation of the Petroleum Exporting Countries (OPEC) said there was no shortage of oil in the market and no need to increase production right now.

Severe cold in parts of the Northern Hemisphere this winter has also underpinned oil's recent rally. Supportive U.S. Midwest factory activity and firmer consumer spending stoked demand expectations and helped turn crude strongly positive.

In London, ICE Brent crude for March rose $1.59 to settle at $101.01 a barrel and reached $101.73 intraday, the highest since prices touched $103.29 on September 29, 2008.

U.S. crude oil for March delivery rose $2.85, or 3.19 percent, to settle at $92.19 a barrel, reaching $92.84 intraday, both the highest since October 2008.

Analysts and brokers had expected Brent's move over $100 to help U.S. crude push above $92.58, the previous 2011 peak from January 3.

"Momentum is up. Traders are buying dips on fears that things could escalate further in the Middle East and spread to other countries," said Tom Bentz, broker at BNP Paribas Commodity Futures Inc in New York.

Oil prices were choppy earlier, with traders reassessing Friday's price surge after fears about contagion failed to materialise at the weekend.

The U.S. price strength narrowed the benchmark West Texas Intermediate crude's discount to Brent to less than $9 a barrel after the spread widened to a near record above $12 a barrel last week.

Dwindling North Sea production and high U.S. crude inventories, especially at the Cushing, Oklahoma, WTI delivery point, have been factors seen as causing the spread to widen, along with investors' attraction to the bullish momentum.

U.S. distillates were seen falling for the week to January 28 due to cold weather in the giant U.S. Northeast heating oil market, while an increase in imports was seen boosting U.S. crude stockpiles, according to a Reuters poll of analysts ahead of U.S. inventory data due on Tuesday and Wednesday.

CONTAGION FEAR

Egypt is not a major oil producer but protests and demands for political change there come two weeks after Tunisia's president was overthrown and investors worry that oil-producing states in the region may face similar protests.

RNBRAD

I say let it rise!! It's the push we need to rid our dependence on oil and car manufacturers will produce more fuel efficient engines, efficient designs, and offer more available energy options. We're now seeing the benefits from the 2008 gas price pinch now. That market will continue to grow as we slowly cut our dependence on oil. I myself wouldn't hesistate owning an electric car and I really feel this is where technology is headed and fast.

K-A

Indeed, it's CRAZY how quickly manufacturers pulled off efficiency miracles since 2008.

There are pluses, and minuses to this. In the long run, it can be a good thing, while in the short run, it can, and will be detrimental to our economy, and many peoples livelihoods.

I'm more pissed now that my 268 HP V6 got 14 MPG on the congested streets today. It's BS. I don't care if it has "only" 268 HP (a good enough figure to me, anyway), but with that figure, I should reap the benefits of great efficiency. Not half-a$$ed efficiency, coming from a motor that "has a good enough figure to me".

RJC

Hello TT's and DFI

K-A

Yup, it's the way of the future. Non DFI, large N/A gas motors are going to be more archaic than ever.

Maybe I'll look into an '11, or late built '10 E63 after-all.

RJC

That sweet 6.2 liter engine will still be available on the all new 2012 C63, and there is a special AMG pkg that adds more power.

I love that motor

220S

And don't forget the SLS. It'll keep the 6.2, too.

220S

Although I said get ready for higher prices at the pumps, that's really a minor issue. We can choose to drive less, use different cars, etc.. Oil costs and driving a car are not the real concern.

The BIG issue is the overall cost of living. Everything will increase. All goods and services. The stuff you buy is shipped either across the ocean in container ships or freighted via truck or train if it's a domestic product (and a foreign product is both across the ocean and then trucked locally.) And anything connected to an oil based product is going to rise in price.

And it will surely dampen the slight positive increase we're now seeing in the economy.

RJC

The only way the world will stop relying on fossil fuel is, when there is no more...

ngerstman

The villain in all of this is Ben Bernanke(if you haven't seen the u-tube cartoon about "the Ben Bernank" you must look it up. Very funny.). Quantitative easing, ie printing money, is a crime against central banking. It is debasing the value of our paper money and setting a pitiful example to the rest of the "fiat currency" world. They are destoying its function as a store of value. A result is surging commodity prices world wide. This will result in lower disposable income for most Americans and especially the lower classes in emerging economies. The latter is one of those unintentional consequences that is resulting in global political unrest in places such as Tunisia, Egypt, etc. as a result of surging food prices. Food is a much larger % of one's budget in those countries than in developed countries and is the straw that broke the back of the impoverished masses. The US consumer lived beyond his means and borrowed too much over the last two decades. Printing money is not the answer. Bernanke must be fired!! Now!! He is a political hack and once again bailing out private equity, the banks, investment banks and hedge funds. KKR gwts richer and we get poorer. Regards. Ned.

MBNUT1

But he won't be fired. The reason lies in his true purpose in this role. See the last two sentences of your post. This issues are far more systemic than the behaviour of one guy.

220S

Yep.