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OIL briefly reached another record on Tuesday May 6th as West Texas Intermediate traded at over $122 a barrel for the first time. Ten years ago a barrel fetched around $15. The feeble dollar, soaring demand and supply constraints have all helped to push up prices by 25% in the past four months alone. And there is little sign of respite for worried governments and consumers. This week Goldman Sachs, a bank, predicted that oil could reach $200 a barrel before the end of the year.Of course, many observers on the left and right believe higher oil prices are exactly what the U.S. economy needs. Higher prices are needed to motivate consumers and producers to substitute into a cleaner, less national-security related form of energy.
Update: Why $120 Oil is Good