Inflation, a lack of production growth, and a weaker dollar will create justification for rising prices. Frontier Oil (NYSE:FTO) is worth a look.

Oil is slowly regaining the attention of savvy investors. After dropping into profit-erasing territory just two months ago, the value of the world’s most valuable fuel source is slowly and quietly on the rise. Investors watching the action are getting in on some great trading opportunities.

Frontier Oil (NYSE:FTO), with a market cap of just under $1.5 billion, is considered a small fry in an industry dominated by behemoths. But that does not mean it does not offer a huge profit opportunity.

As inflationary fears rise, the nation’s economy returns to growth and the government does its best to bump up the price of any pollution-emitting fuel source, companies like Frontier will see their share prices grow.

Read the full article here at TFN: Frontier Oil: Buy low, sell high

Trading was influenced by supply concerns, after hundreds of oil workers at Ineos PLC’s Grangemouth refinery in Scotland started a two-day strike Sunday, forcing the closure of a BP-operated pipeline that transports 700,000 barrels of oil a day, about 40% of the U.K.’s daily crude production.

“Given this troubled backdrop, we expect the markets to remain firm at least until mid-week, when the Scottish strike is scheduled to come to an end,” MF Global’s Meir wrote.

Analysts said the problems extend beyond the immediate impact of strike. The refinery will take some time to restart even if the labor dispute is resolved quickly, possibly forcing more lengthy disruptions of oil shipments.

Jitters were stoked by new violence from the deteriorating Nigerian situation. News reports said that five policemen were killed Sunday when rebel groups attacked the nation’s largest oil and gas terminal.

Royal Dutch Shell Plc said a militant attack on a pipeline has cut as much as 169,000 barrels a day of Nigeria’s Bonny Light crude production as rebels claimed responsibility for two more strikes today.

Crude futures contracts in New York have hit fresh highs of $117+ a barrel on the news of the attacks. Crude oil prices climbed to a new record after Shell said exports would be cut — the highest since futures started in 1983.

“The people of the Delta have a point,” says commodities expert Garry White. “It appears that they are not benefiting at all from Nigeria’s oil wealth (although bombs are not the way to reverse that situation in my mind).

“However, it is not my job to moralize on this situation; I’m here to look at facts.

“With global supply so tight, any supply disruptions will send oil traders into a tizzy … This is yet another bullish factor for the oil price.”