When gasoline prices ratchet up and it costs a hundred bucks to fill your car, the political comedy starts. Who to blame?

In the United States, the right blames the left and vice versa. Fuel taxes are too high, the American motorist moans, even though taxes in the United States are among the lowest in the world. Newt Gingrich is so outraged about high prices that he vows to slap a $2.50 (U.S.) a gallon price ceiling on gas if he is installed in the White House. At the same time, he supports tighter sanctions on Iran, one of OPEC’s biggest oil exporters, and is calling for regime change in Tehran.

Call us contrarians, but bombing Iran to get lower oil prices seems a slightly flawed strategy.

Then there are the oil Pollyannas, among them the energy analysts at Citigroup. Last month, they published a report that said soaring production in North America could turn the continent into “the new Middle East,” thanks to the suddenly prolific shale oil deposits. So relax and buy that SUV that sucks two gallons to haul your marshmallow butt to the Starbucks.

The market is not listening to the politicians – some of whom want to drain strategic petroleum reserves in the United States and Europe to put a lid on prices – or the energy gurus who think peak oil is a myth. The price keeps going up. In spite of the shale oil gushers, the euro zone recession, falling or flat oil demand in many of the wealthiest countries, and a new generation of fuel-sipping cars, prices simply refuse co co-operate. This week, Brent crude (the best, though still imperfect, measure of global prices), climbed back to nearly $125 a barrel.

Brent is up about 10 per cent this year, after climbing 32 per cent last year, 21 per cent in 2010 and 66 per cent in 2009. That is a sustained rally and it means oil shocks are a real and present danger, in spite of the extra supply erupting from the bowels of the Dakotas and Saudi Arabia’s claims that it has enough spare capacity to push prices down.

So, who to blame? Try demand. Oceans of cheap money might have something to do with it, but there is no doubt that too little of a good thing is being produced as demand rises relentlessly. The smart Barclays analysts in London, Paul Horsnell and Amrita Sen, have refined the demand side of the equation, inventing the acronym BICS, to be confused somewhat with BRIC, to explain what is going on. BICS stands for Brazil, India, China, Saudi Arabia.

Those four countries alone go a long way to explaining why oil keeps going up, to the point politicians everywhere are in a low-grade panic about high prices that threaten to reverse the economic recovery. The analysts have calculated that oil demand in the BICS has grown since 2006 by 5.1 million barrels a day, while demand in the rest of the world has fallen by 1.4 million barrels. In that sense, North America and Europe are not part of the price-surge problem.

Why are those four countries consuming so much? In China, it is rising internal trade and demand for plastics and petrochemicals, according to Barclays; Chinese diesel demand is rising at 7.5 per cent a year. In India, diesel consumption is soaring because of farm mechanization and rising commercial freight deliveries. Saudi Arabia is triggering oil demand by spending fortunes on infrastructure, all the better to create jobs for the 65 per cent of the population that is under age 25. Oil demand in Brazil is rising at 8 per cent annually because of strong economic growth.

Note that ever higher prices are having no effect on tempering oil consumption in the BICS. Their slurp-a-thons seem unstoppable. For every barrel of oil that North America and Europe give up, the BICS take almost four.

The problem is that supply is not rising fast enough. If the Saudis had as much spare capacity as they claim, why did the price rise as fast as it did, and why are they unable to get it down to $100 a barrel, which is their stated comfort level.

And before you think that salvation will come from American shale oil, consider this fact: The Bakken discovery in the northern United States, the oil play that has the industry buzzing with excitement, has estimated recoverable reserves (using current technology) of no more than 4.3 billion barrels, according to a 2008 U.S. government geological report. The world consumes about 32 billion barrels a year. Do the math. Globally speaking, the Bakken is insignificant, and will remain insignificant even if the reserve figure doubles.

Oil could go down in price if politicians panic and tap into strategic reserves, or a full-blown recession grips the industrialized world. The business-as-usual case, however, suggests that triple-digit prices are here to stay. Blame the BICS.