Oil is now selling at $126 a barrel (at London Brent.) If it keeps going too high, leaving moving average (average price of a barrel for the past few days) too far behind, then people will expect price to fall, sooner or later. Sale will slow down, market will be oversupplied- leading to a precipitous fall in prices.
In that light, it is my sincere hope that oil price does not spike upwards, but keeps rising at a steady rate.
Now here is why I am cheering high prices of oil-
1. Oil is undervalued. Like gold, we have only a finite supply of it. Unlike gold, we are using it up at an ever accelerating rate. The price must go up for the consumption to slow down.
2. Burning fossil fuel is one of the leading causes for global warming. High prices of oil will force leading emitters to change their habit. Mere preaching has had no effect so far.
3. High price of oil will level the playing field for developed and developing countries. Developing countries are much more fuel efficient (Widespread public transport etc.) and are much more frugal about spending energy.
The rich countries, on the other hand, have built their system on cheap/stolen oil. As all oversupplied economies do, they are horribly inefficient in terms of energy usage. A high price of oil will force them to become more energy efficient- something the poor countries have already got.
4. After trillions of new dollars (printed out of thin air as bailout money), the value of the dollar ought to be on the decline.