Cramer: Gas Prices Are a Huge Worry

This post from Jim Cramer's blog originally appeared Feb. 21 at 5:48 a.m. ET on RealMoney.

NEW YORK (RealMoney) -- Five-dollar gas. I don't know how it can be stopped as long as Iran is meddling and developing nukes, other than through demand destruction.

If you go back to 2008, when oil spiked to the $140s and gasoline peaked at $4.11 a gallon in the summer, we know it had a huge impact on the economy both here and abroad. In the U.S. it was just enough, after the housing crisis had begun and the Fed was slow to cut rates, to start us on the path to the Great Recession.

That recession, plus the overwhelming fact that oil was buoyed by speculators caught short while others used the thinly-traded futures to corner petroleum, caused oil to plummet, taking gasoline with it. Some would say it just got too expensive too fast and people found instant ways to cut back. That's demand destruction talking.

This time, while speculators are playing a role, the most recent 20% jump in Brent Crude is directly at the doorstep of Iran. There is no way, with Europe so much weaker than it was in 2008, with the United States producing so much more than in 2008 and with China still using a ton but not accelerating its use with any alacrity, that prices deserve to spike much higher, let alone to the $140s, based on demand. European demand is dropping pretty quickly and the U.S. is still not back to where it was in terms of oil importation.

That leaves the hoarders (no, not one of those shows where they hang 18 dead cats with ribbons around pipes in their kitchen) but real users who are afraid that Israel and Iran will go to war and oil will be cut off from the region. These are fair worries. Anyone who dismisses them, I think, isn't being realistic given that the current Iranian government has stressed over and over again that Israel has no right to exist, something akin to what the Nazis said about the Jews in the Third Reich era.

That means container ships are being filled with crude and being held back from the markets. That means speculators are running ahead of legitimate users who are trying to hedge pricing, a time-honored concept if there ever were one. That means the prices aren't going down until the Iranian situation is resolved. Perhaps we can live with it like the North Korean blackmail the world lives under, but I don't think Israel will stand for it.