Oil nears $87, on its way to $100

Overnight, a barrel of crude hit $86.79 on the New York Mercantile Exchange, according to MarketWatch. The news site says, "Among the bigger news items impacting oil, Turkey's government asked parliament late Monday to approve a cross-border offensive against Kurdish rebels in Iraq."

But it now appears that almost any excuse will move oil up.

And this is not the end of it. OPEC is only lifting production by 2% in November, while Chinese demand for imported oil rose 18% in the first eight months of this year. Turmoil in areas where oil is produced is growing. Nigeria and Venezuela are not considered stable. It will not take much of another "little war" in the Middle East to move crude higher. The only good news is that hurricane season is winding down and production interruptions in the Gulf of Mexico are less likely.

With a tip of the hat to Al Gore, the rotund champion of the environment, former Vice President, and current Nobel winner, big economies are still their own worst enemies in the arena of energy consumption. There is no reason to believe that supply can keep up long-term, and OPEC sees no reason to help out. Higher oil prices are an excellent money-making proposition.

Oil is moving higher. There are too few forces to move it down. And, with winter setting in around the Northern Hemisphere, a bit of oil is going to be needed to keep us warm.

Douglas A. McIntyre is a partner at 24/7 Wall St.