THE BURNED OVER DISTRICT

The supplies are plentiful and there are no current kinks in the supply line, so there is no organic reason why prices should be rising. But if you are a Big Swinging Dick on Wall St with Ooodles of cash to throw around, why not gamble on a commodity that everyone expects will rise in price?

Prices tend to spike around Memorial Day, when increased demand cuts against a limited supply as refiners convert from winter fuels to summer blends. But by the middle of June, gasoline inventories are up and prices typically retreat.

This year, they haven’t.

The reason why refutes the commonly held view that deteriorating political conditions in Iraq haven’t had much effect on gasoline prices. They have.

Despite no apparent hit to Iraqi crude production, and near-record levels of U.S. oil production, fears about the Middle East conflict have allowed financial speculators to bid up oil prices _ another contributing factor to high gasoline prices.

The authoritative AAA Motor Club had projected in May a drop between 10 cents and 15 cents a gallon during June.

But Michael Green, a spokesman for AAA on gasoline prices, said Iraq’s troubles are affecting prices more than expected. “U.S. consumers are paying higher prices than what they would otherwise, due to the higher cost of oil,” he said.

Speculative trading on the violence in Iraq is keeping oil prices about $4 a barrel higher than they would be otherwise, said Andrew Lipow, president of the Houston consultancy Lipow Oil Associates.

And that’s affecting consumers. Gasoline prices on Wednesday averaged $3.68 for a gallon of regular unleaded, up slightly up from $3.66 a gallon a month ago and more than 13 cents a gallon higher than at the same time last year...

Here’s the explanation for the stubbornly high prices: Fear has gripped oil trading markets, after the Islamic State of Iraq and Syria, known as ISIS, seized the Iraqi city of Mosul on June 10 and Fallujah soon afterward.

Financial traders fear a collapse of the Iraqi state that could suck Iran and Saudi Arabia into a regional conflict that threatens oil supplies. And those financial players far outnumber actual end users of oil in the markets where contracts for future barrels of oil are traded.

Futures trading was created to smooth out the ups and downs of normal business. With Wall St. awash in money, the BSD have turned futures trading into another big money gambling hell and we pay the price.