Conventional wisdom has long suggested that speculators have been the culprits in driving global oil prices to stratospheric heights. But after crude prices hit an early April 2008 high of $112 and averaged just shy of $100 for first-quarter 2008, this conclusion may need to be rethought.

"If we are at $112 per barrel for oil in a U.S. recession, how do you interpret that?" asks Paul Sankey, managing director and senior oil analyst for Deutsche Bank equity research in New York.

His view: The driver of high crude prices isn't necessarily speculation by hedge funds and the like on the floor of the Nymex. Rather, "supply spare capacity is terribly weak, almost scarily so," the analyst contends.

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