Best thing that explains why oil is over $125 a barrel would be for you to look up the increase in the number of cars in both China and India over the past 10 years.

But $125 currently is primarily speculation. A lot of the money that otherwise would be going into real estate is now flowing into oil because that is the next "sure thing". Like all bubbles it will eventually pop and then drop down to a more "natural" number which currently is thought to be around $80-$100 a barrel. When this "pop" will occur is anyone's bet, I know better than to try to "time" the market.