Oil "had been" falling nicely over worldwide recession fears. In fact, it fell more than $9 a barrel in two days. Then, Iran tested 9 long and medium range missiles. In responses, oil jumped again.
Over the last 3 years, my guess is that at least 60% of the rise in the price of oil has been a direct result of Iran's actions and words. The balance of that rise has been due to rebel activity in Nigeria and the threats to cutoff oil to United States by Venezuela and the falling value of the U.S. dollar against other currencies.
Just think about it. Today, oil prices jumped on Iran's missile tests. Last week, oil prices were, again, somewhat stabilizing and, then, Iran threatened shipping in the Straits of Hormuz and that potential was seen as cutting off 40% of the world's oil from delivery. Then, there have been all the verbal threats against Israel and the United States. Almost a week doesn't go by and, like clockwork, where Iran causes oil to pop.
Iran's economy is almost entirely based on oil. The world market for prayer rugs and fanaticism just doesn't have a worldwide economic appeal! So, if they can pump up the price of oil, they can get more cash to flow into their country. Because oil is so important to their economy, any disruption in selling it to the world would actually hurt them in the process. So, I think a lot of this bellicose talk is all a game to increase the oil revenues for themselves. (Note: This is not to say that anyone should ever underestimate their fanaticism and their hatred and desire to destroy Israel; should they get their hands on working nukes!) They, like Pavlov's dogs tests, have learned that all their "big talk" causes oil traders to salivate and run to buy oil; speculate; and, drive prices up. It's a game and the West is too stupid to see. In the mean time, the entire world is suffering in the wake of this game. If oil supplies weren't so tight, Iran wouldn't be able to play this "hand of doom" gambit that they have going. But, we and the rest of the World are knee-deep in foreign imported oil and are too stupid to do what is necessary to put an end to it. We're too busy fighting a possible ghost of a reality called Global Warming.
Once and for all, we need to get this monkey off our backs. We need more production and a strategy to abandon our increasing dependence on this "volatile" commodity. Except for Mexico and Canada, we are totally dependent on the stability of the most unstable countries of the world for our energy needs. How insane is that! And, our government just keeps committing us to more of that insanity as both time and their inaction continues on. Where is crazy Susan Powter when you really need her. Stop the Insanity!