Last week, a rumor that the highly regarded, Paris-based International Energy Agency (IEA) was planning to lower its long-term forecast for worldwide oil supplies spiked oil prices over $135 per barrel, an historic high.

The shock ran through Wall Street, which is still holding its breath for the IEA forecast – the first study of its kind to explore depletion rates at approximately 400 oil fields worldwide. According to IEA’s chief economist Fatih Birol, the report heralds "a new world energy order."

Birol refused to speculate on whether the report would send supplies drastically downward, but the report – which will identify oil levels through 2030 – is likely to be skewed by the impenetrable reporting protocols of such nations as Saudi Arabia, leading to imprecise estimates. In addition, Birol sees the impact of tightening supplies mitigated by a more national focus on oil in the coming years, as countries like the U.S. expand exploration of regional reserves. Even so, the suggestion and the prospect of a new world energy order is chilling.

Simon Wardell, an oil analyst at Global Insight in London, said the IEA report – due out later this year – would have only a modest effect on investment because oil companies are already exploring their options. The IEA, which has no links to the Organization of Oil Exporting Countries (OPEC), also recognizes that its report may challenge OPEC’s stated view that the world has plenty of oil, leading to some blowback and fracturing international relations as countries like Saudi Arabia (the U.S.’s second-largest supplier) attempt to defend their political alliances based on coveted oil reserves.

Prompted by the oil spike on the Street, U.S. Energy Secretary Sam Bodman told Congress that the situation is a result of production failing to keep up with demand, and suggested Congress vote to open the Alaskan National Wildlife Refuge (ANWR) to drilling. Edward Markey (D-MA) added that selling oil from the Strategic Petroleum Reserve (SPR) would bring prices down over the short term.

Neither is a long-term solution. ANWR has only an estimated 10 to 15 billion barrels of oil available. At almost 8 billion barrels per year, this represents less than two years worth of oil to the U.S. and, even if opened this year, would not begin delivering until 2018 because of lack of transportation facilities like pipelines. The environmental consequences, coupled with melting permafrost releasing methane, are unthinkable, the cost/benefit ratio not even worth considering.

The SPR, as of May 16, stands at 702.7 million barrels of oil, most of it purchased at an average $28 per barrel. A good price, but a critical reserve that must be maintained in the event of serious disasters (think international war or plague). The Senate has already voted to stop filling the SPR, and, even if it were to agree to release SPR supplies, these would only last slightly more than two days. In the U.S., we use one barrel of oil per person per day. The U.S. population today stands at 304,179,094.

Some say speculation, specifically hedge fund investing by exempt institutions, has fueled the spike in energy prices. These exempt investors (corporate and government pension funds, sovereign wealth funds, university endowments and other institutional investors, and Wall Street banks), unregulated by either the government or the Commodity Futures Trading Commission (CFTC) by 1974 legislation, have stockpiled a phenomenal 1.1 billion barrels of petroleum, or more than more than the SPR reserve.

Oil contracts for the week of May 18-24 have surged dramatically, some dated as far forward as 2016, with futures prices higher than spot prices. The event, known as "contango," has led Edward Morse, a Lehman Bros. oil expert, to predict a coming oil bubble not unlike the recent housing bubble, in which speculation, not value, drives prices; a futures market which he describes as "unhinged from reality."

That’s an accurate description of Wall Street in this eighth year of the new millennium. Even traders have lost sight of the reality that when it all comes crashing down, wealth won’t drive the dogs of war from the door. And what can one expect of a populace accustomed to having everything, then suddenly having nothing (including affordable food and enough gas to get to work), except a war to reclaim their lost heritage of privilege?