With oil prices breaking their all time highs, investors and market analysis experts are analyzing the causes behind this phenomenon. They have discovered one helluva vicious cycle.

Rising oil prices pressures stocks, and falling stocks push investors into oil. Under normal circumstances that dynamic would spell a bubble, but unlike tech stocks, the market–through necessity–is much more willing to pay, leaving prices at unreasonable highs. That is until demand destruction sets in, but it’s difficult to see that really take hold in the short- or mid-term.

Also at blame for these record prices is the lack of a strong US dollar. Oil sold to foreign investors under the dollar is a lot cheaper, which drives up the demand for the already very limited resource.

It seems that almost every day there is an editorial urging John McCain to relieve the American people of their high gas price burden. But rather than an endorsement of his gas tax vacation, the average conservative citizen is urging McCain to drill for domestic oil. If he indeed decided to drill for more oil on American soil, he would be embraced by the right.

But how much good would it do? The Wall Street Journall’s Real Time Economics has an article indicating that even if we were to drill in the massive ANWR reserves, it would not be likely to impact gas prices now.

Furthermore, 2008 Central has a humorous bit of an exploitation article on the same issue. In 1985, McCain insisted (very strongly) that offshore oil in states like California should be distributed to Americans on a national level. Now he claims that he wants to do the exact opposite. On top of that, the most optimistic projections for offshore drilling is that it will lower gas prices by eight cents a decade from now.

In the past, McCain has supported initiatives for research into alternative fuels and seems to have a fair grasp on our energy crisis worldwide. In order to maintain that image, he needs to get his act together regarding gasoline.

Just when you think your worst nightmares are over, oil jumps to over $140/gal. (Remember when we thought $100/gal was obscene?)

Now pundits are predicting $7/gal gasoline by 2010 with oil at $200/barrel. Americans will soon be paying the same price as Europeans!

So, park that second car, get out your bicycle or walk. Better for your health anyway.

For the highest production rate since 1981, the Saudi King Abdullah says the Saudis will increase daily oil production to 9.7 million barrels from 9 million barrels. The increase is supposed to take place in July.

Petroleum minister, Ali I. Al-Naimi, also said the government would invest in oil projects that would allow Saudi Arabia to produce 12.5 million barrels/day by the end of the year.

King Abdullah’s remarks came at the end of the Jeddah energy summit, where he also called for OPEC to set aside $1 billion for a strategy to ease the oil price crisis. He said $500 million should be given to developing nations to help them get the energy they need.

King Abdullah said there are “many factors that made oil prices high.” Along with increased demand, he also cited oil speculators and an increase in taxes in consumer nations.

US says lagging production, they say speculators are the source of the problem. You be the judge.

Gas promotions are ubiquitous. It is not just about cars. Business Week notes a rash of promotions including grocery stores and radio stations.

But the Red Cross? Sure enough.

Karen Kelly, senior director of marketing and communications for the American Red Cross, said the Northern Ohio Regional Red Cross has started holding a sweepstakes competition where, on Sept. 1, one lucky winner will get free gas for the entire year. “People say, ‘I donate blood because I want to,’” Kelly said. “But they also say, ‘If I win, that’s great.’”