How hyperactive policy makers become when the price of oil starts to haunt their dreams. Three weeks ago, the Group of Seven leading industrial countries demanded that oil-exporting nations be ready to pump more of the stuff. That was after a rise in the price from $90 a barrel to $115. This week Saudi Arabia appeared to oblige, amid signs that it had lifted production to 10m barrels a day from about 9.9m. That combined with a fresh stimulus package in Japan to bring the price down towards $110 yesterday. Then there was the oil-price “flash crash” – a $4 plunge in 30 minutes on Monday. If this was any other commodity, an insider trading inquiry would already be under way.

The aim of this frenetic activity is to keep the price of Brent below $120. That seems to be everybody’s red line, the point beyond which the oil price must not pass. Saudi officials complain that the price at its current level is too high. With the world economy sagging, the worry is that a move above that level could accelerate the global slowdown. Tensions are high over Israel’s increasingly hard line on Iran and the attacks on US embassies across the Middle East.

The oil market, left alone, is likely to do its job and balance the political threats to supply and the economic threats to demand. When the oil price soared to about $145 in the summer of 2008 it did not do any lasting damage: the world economy was already in crisis because of the breakdown of the banking system and, in any case, it fell back to about $60 in the early spring of the following year.