The price of oil set a new record today closing at $58.60 a barrel.

The analysts say there are two reasons for this though:

1. The United States and other Western nations shut down consulates in oil-producing Nigeria following a terrorist threat. Nigeria is the world's 8th largest oil producer and thefifth-biggest exporter or oil to the US.

2. Concerns about the ability of US refiners to cope with strong U.S. demand.

Saudi Arabia is the only OPEC member that has spare pumping capacity. All of the other OPEC countries are pumping oil as fast as the Earth will let them and can't pump any faster.