It's exactly like the stock market - the commodities are bought and sold just like stocks. So unfortunately, speculation drives up the commodity price. Which drives up the refniery prices. Which drives up the consumer prices.
It certainly does suck.
The story does mention that production was cut because of the kidnapping. The kidnapping led Chevron to shut down an oil station, which reduces it's ability to pump oil. Hence the 15K reduction.
My understanding of the market for the past year is that supply/demand are very tight - even a small supply reduction is not absorbed by the market very well, especially with ever growing demand domestically and abroad. The high prices give companies more incentive for E&D, which help address supply side issues somewhat. But with the demand increasing constantly, it's a high wire act.
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