While crude pricing has been relatively stable in recent weeks, overall prices are currently trading at near 52-week highs.  Outages in Libya, the ongoing boycott against Iranian oil and security concerns in Nigeria are all contributing to the market's concern that global supplies could become tighter.  Russia's current intervention into Ukrainian politics has also added support to globally traded oil prices.

The continued growth in domestic U.S. crude production has so far served as a damper on such geopolitical concerns.  Latest U.S. DOE statistics reveals that domestic oil production rose to 8.46 million barrels a day (b/d) last week, up from 7.2 million b/d at the same time last year and 8.38 million b/d just a week earlier.  The combination of increased U.S. production and the maintenance of a 30 million b/d OPEC quota commitment has thus far served to mitigate global geopolitical concerns.  Recent developments of instability in Iraq, however, with increased militant activity on the part of the Islamic State of Iraq and Syria (ISIS) could dramatically impact market prices in days to come.  With Libyan production essentially anemic and the return of Iranian sanctioned crude expected to be protracted, concerns over Iraqi oil production could have a dramatic influence on oil markets.  Market optimists had anticipated Iraqi production this year would approach 4 million b/d, up from 3 million last year.  The recent repeated bombing of the 600,000 b/d Kirkuk-Ceyhan pipeline will in itself significantly impact export activity.  In addition China's recent decision to build strategic reserves of its own coupled with continued economic growth in that country are serving to underpin strong global oil prices.

Accordingly, some market analysts fear that a $125 per barrel Brent trading value could be achieved in weeks to come.