NEW YORK (FORTUNE) - All of us buy gasoline to drive our cars or heating oil to stay warm in the winter. Even if we heated our homes with peat and solar panels, we'd still have to pay higher energy costs being passed along by airlines and hotels and supermarkets.

It's no surprise, then, that the parallel rise of commodities trading and energy prices has sparked a fierce debate over whether hedge funds, traders and Big Oil are responsible for $3-a-gallon gas, with the blame game stretching from the boardrooms of Big Oil to Capitol Hill and Bill O'Reilly's Fox News studio in New York. (This is an excerpt from a story in the May 29 issue of FORTUNE. For more on how speculation affects oil prices, click here or go to www.fortune.com)

Indeed, just about everyone is ducking for cover. Big Oil is pointing fingers at hedge fund managers, who blame commodity index funds, who in turn cite surging demand in China, production losses in Nigeria and Iraq, and hostile regimes in Iran and Venezuela.

Fox's O'Reilly, at least, is clear: He blames all "these Vegas-type people [who] sit in front of their computers and bid on 'futures' contracts." As he puts it: "Supply and demand? - my carburetor, this has nothing to do with the free market."

If only it were that simple. The reality is that while many hedge fund managers and traders are making reams of money off of rising prices, they don't have the heft to control the huge $2 trillion worldwide oil market.

That's not to say investment flows have zero impact on prices. As pension funds and investors reallocate more of their portfolios to commodities, the flood of assets has spawned strong momentum in the futures market.

But oil's price climb started well before the hot money moved in. Here are six crucial catalysts.

China's economy, growing at 10 percent, recently passed Japan as the world's second-largest oil consumer, while India and other developing countries are surging. In the U.S., by far the globe's No. 1 energy user, gas demand is up 1.7 percent annually over the past decade.

Iraq's oil production remains below prewar levels, and saber rattling in Iran fuels uncertainty about supplies traversing the Strait of Hormuz.

Big Oil has been wary about over-investing in new production for more than a decade, fearful of hurting their margins if oil prices retreat. So cash that might otherwise have gone toward enlarging supply remains on the sidelines.

Unrest in Nigeria - including kidnapping of oil workers and pipeline sabotage - has cost roughly 500,000 barrels a day. Venezuela, where production is still feeling the effects of a 2003 strike, has begun raising taxes on foreign drillers.

The so-called Peak Oil theory, that the earth's supply of crude is dwindling, has been fed by worries that the productivity of Saudi Arabia's oil fields is slowing. Meanwhile, some major oil companies struggle to replace what they pump - Shell hasn't fully replenished its reserves for several years.

Katrina & Co. swamped refineries and waylaid deep-sea rigs, disrupting supplies and driving up gas prices. Another potentially harsh hurricane season looms.

To read the full story, click here.

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