Oil prices rose to new highs of 76 usd as traders watched tropical storm Chris in fear of it developing into a hurricane and damaging rings and refineries on the oil-rich Gulf Coast.
The much hoped for cease-fire in Lebanon also seems like a distant possibility with Israel killing 11 more people and capturing 3 Hezbollah fighters.
Further dissent in the Iranian nuclear matter has also caused the sudden climb in prices as well as concern that Iran and Syria, both backers of Hezbollah, are ordering troops to 'raise readiness'.
Iran's supreme leader Ayatollah Ali Khamenei has called on Muslims everywhere to resist US and Israeli aggression as Iran refuses to bend to the UN deadline and stop uranium enrichment.
In the event that sanctions are imposed against Iran, it is likely that the country might retaliate by blocking the Strait of Hormuz, which is a essential outlet for oil shipments to the US.
While the key issue in the oil price matter is supply instability, it is also expected that the inventory data will show a huge draw in US fuel stocks with high demands despite the $3 gallon prices.
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