*The price of oil is determined by commodity pricing and driven by the law of supply and demand. As developing nations such as China and India have higher energy demand it drives the commodity price of oil up and the increase in their demand is expected to continue for the next 15 to 20 years. In addition to the increase in demand, government has increased the regulations placed on fuels to create lower emissions of pollutants it adds to the cost of oil related products. In addition, it the restriction on drilling for new supplies of oil in such places as in Alaska's Arctic National Wildlife Refuge or in the ocean off our coasts.
*America's energy crunch is sadly self-inflicted. While others around the world engage in a mad dash to find more oil reserves, the U.S. seems to think $130-a-barrel oil won't be affected by more supply. Europe continues to fully exploit its oil reserves in the North Sea, without worrying about hurdles such as the Kyoto Protocol on greenhouse gases or concerns about damage to the ocean ecosystem. Yet "peak oil" advocates in the U.S. argue that we're already at the end of our large-scale recoverable reserves. Conventional wisdom is that the U.S. has just 30 billion barrels of oil left, enough for just 10 years of pumping at current rates. The 2,000 acres of the Alaska National Wildlife Refuge have as much as 16 billion — enough to replace 30 years of Middle East imports. We need oil. It's the lifeblood of our economy. And fortunately we have lots of it. But because of Congress' unwillingness to go after it, we're leaving billions of barrels untapped, driving up prices and causing untold economic hardship.