Will inflation fears send oil to $250?


In case you're wondering why interest rates are climbing along with the price of filling up your gas tank, the answer is simple: fear of inflation. The U.S. has pumped so much money into the economy -- including $12.8 trillion to bail out banks and others along with cutting the Fed Funds rate to almost zero -- that people around the world are beginning to question the strength of the dollar.

This fear creates a trading opportunity, the same one that drove oil up to $147 a barrel last July. And now Gazprom's CEO is forecasting oil will hit $250 -- more than three times its current $71. That's a prediction from which traders are profiting. How so? Traders bet on a drop in the dollar and a rise in oil; they do this by selling the dollar short and buying oil futures.