Farewell to $60 oil; Brace yourself for $80

SAN FRANCISCO -- Crude's back at record levels, with the $60-per-barrel price we saw just last year out of the picture for now, maybe even forever, and $80 oil a real possibility by the end of the summer.

"Producers and consumers alike should get used to the fact that oil prices will likely never fall below $60 a barrel again," said Emanuel Balarie, a senior market strategist at Wisdom Financial.

The front-month contract for crude futures closed at $75.19 a barrel Wednesday in New York -- the highest closing price ever -- and the price rally has not stopped there as a world of political turmoil, direct threats to production and supplies and a strong global appetite for oil come together to rattle investors' nerves.

"Whether it be tension with Iran and North Korea, war in Iraq, summer gasoline demand, [or] refinery outages, prices are going to be very sensitive to supply disruptions and/or perceived potential disruptions," said Thomas Hartmann, an analyst at Altavest Worldwide Trading.

The oil market has been factoring in daily news related to the nuclear standoffs between Western nations and Iran and North Korea.

At the same time, the market is routinely bombarded by strong demand figures for oil from countries around the world, especially China. Refinery outages, the recent closure and reopening of a key waterway in Louisiana and storms in the Atlantic also serve as reminders of oil's fragile supply system.