Dear Wealth Daily reader:

Many people are starting to jump on the $70 oil bandwagon. And long time readers of Wealth Daily know that Mike Schaefer is in the driver's seat.

The idea of $70, $80, or even $100 oil is not so unbelievable anymore. It's become more of a "when" than an "if" debate. The fact is that you'd be pressed to find an analyst who believes we'll see $30 oil again.

There are still those among us who believe that the market actually has enough supplies to, so to speak, hold us over for a little while. But even if this is the case, the reality of the oil market is that it is not based on such reason.

Rather, the motivation behind the recent high oil prices is fear.

And it's fear that's not only going to sustain the current oil prices but continue to push them higher.

Concerns over OPEC production, Chinese consumption, hurricanes in the Gulf of Mexico, refinery shutdowns, the Iranian crisis, IEA forecasts, anxiety over this, concerns about that have all resulted in the same thing. Higher oil prices.

The oil market is more sensitive than a thirteen-year-old girl with bad acne and low self esteem.

And there's nothing we can do about it. We can only prepare for the inevitable.

You see, all these things, production worries, supply and demands woes, they're not going to go away. In fact they're only going to get worse.

And it's obvious that they all have a direct effect on the price of oil.

Here's how I see it. We can add a certain dollar amount to the price of oil each time there is a concern.

Anxiety over OPEC production + $1.50 per barrel
New hurricane in the Gulf of Mexico + $1.25 per barrel
Refinery shutdown + $0.75 per barrel per shutdown
Latest IEA forecast + $0.50 per barrel
Terrorist activities + $1.75 per barrel
Adverse news from Iran + $1.00 per barrel
Chinese consumption raises + $0.75 per barrel
Angst over heating oil supplies + $1.00 per barrel

These figures are simply estimates. But the fact remains. Fear has been driving oil prices up for a long time now. And it's not going to stop.