I just had a call from George Bush to reassure me that everything was okay, and I need not worry, we can solve the whole problem by drilling ANWR.

Not sure that this even beats the inflation adjusted prices from the '73 embargo but hey that was an embargo. Another consideration is that oil prices aren't as high traditionally in winter as they are in summer.

This price is partially due to increased uncertainty from events in Pakistan but who's to say the social/economic pressures are going to get radically better anytime soon?

Has anyone realized there is an oil shortage and demand is higher than the supply? Boy! are we Americans good at not wanting to face the truth! People, the high price of energy over a short period of time has now put us in a recession and we certainly are there! A couple of indicators are: gold at $850 an ounce, plunging home values, the federal reserve printing money 24 hours a day, less money spent on other things other than energy, and oh, yes! oil at $100 a barrel. Believe it, the county is in trouble with no one with intelligence in the White House. Looks like Hoover Ville all over again with no FDR to get us out this time.

The inflation adjusted high during the embargo in '73 was $102 or so. We're knockin' on embargo numbers, even with relatively few major events during the run up to $100.

Lad the US is not in a recession. A recession is defined as two consecutive quarters with negative economic growth. The current expectations for the US economy is less growth than usual not a recession. Oil of $100 or $120 is not enough to bring on recession in the US. The subprime crisis and the exploding US budget deficit are far more dangerous to US growth. Higher oil prices are good because they induce conservation and the development of alternatives of which most are ‘greener’.

Furthermore, the world economy is hardly paying any notice to growing oil prices. In 2006 the world GDP grew at 5.3% which is record growth. 2007 will not show less than 3% growth and it is likely to be 4% which is also very high. The planet will adapt to increasing oil prices without any important economic disruptions.

Henrik has it right on the macroeconomics, but there is a bigger picture to consider. An aggressive projection of U.S. military power in the middle east costing hundreds of billions of dollars per year over the past several decades secured the shipping lanes, stabilized the oil producing monarchies, thereby delaying by 20 years an inevitable increase in real oil prices. As a result, worldwide addiction to oil was solidified and the infrastructure of radical Islamic Terrorism financed and built from a steady stream of OPEC revenues. Its unfortunate we did not utilize the calm before the storm (Security and Climate Change) to reduce our dependence on fossil fuels, scale back or dismantle our wasteful military intervention in energy markets, and allocate more national resources and trade preferences to developing countries that implement democracy and sustainable development.

Henrik:

Time may prove you right.

OTOH, how much longer can USA run huge budget and trade deficits without affecting the American economy?

Printing more $$$ will create more inflation and eventually an economic down turn.

Time has come to bring the troops home, reduce war budgets and invest heavily into a new (clean) ELECTRIC economy.

A few hundred $$$ billion (a year) have to be redirected to mass production of ESSUs, PHEVs, BEVs, wind mills, solar energy, add 100 up-to-date nuclear power plants, dismantle of dirty coal fired power plants, improve electricity power grids, (and close NASA for the next 20 years if you have to) etc etc.

A carbon tax, on dirty coal power plants + gas guzzlers could finance part of this project.

Will oil, coal, farm, car and labour lobbies allow it or fight it with all means at their disposal?

What a challenging 20-year project?

if you measured oil prices in euros.. how would it compare?.. lots of this price inflation is due to the falling value of the dollar, not on supply and demand issues..

Herm:

Devaluation of the USD has certainly helped to increase oil price in the last two or three years.

If quoted in Euro, oil price would be about 70 Euro now vs xx Euro 5 years ago.

No recession? You must be stupider than you look...(spoken in a Shelbyville accent)

If ever there was a time to Impeach a President, now is the time. Not only did his administration play a role in hyping tensions in the Middle East, he has done NOTHING to resolve this countries dependency on foreign oil! It's unfortunate because after 9/11, he had the chance to be a leader and unite the World but decided to be a follower and go with the Neo-Con's, who have all tarnished his legacy. You have to feel bad for his father and children, who history will record as the Worst President Ever!