For all the reasons stated just below I belive that our current supply of 'easy oil' is all but used up. No, not tomorrow but in the near future there will be very few ploaces where you can just punch a hole in the earth and put a pipe on it to take it to a ship.

In the future our supply of petro-fuel will be found in really really hard to get to locations such as in the middle of the deep ocean and 40000+ feet down, or it will be some new efficient way to develop the largest deposit on earth now, the Athabasca tar sands. But this has problems also. It's expensive and it has huge environmental issues in Canada.

So I'm firmly of the belief that today we are seeing the least expensive petro-fuel that we or our children or grandchildren will ever see again. Oh for the good ol' days of $2.89 gasoline.

My person forecast for my own budget is the following ..
$3.50 on average in 2008 with a minimum of $.50 per gallon increase for each of the following 'x' years.
Average Fuel prices / Year
$4.00 / 2009
$4.50 / 2010
$5.00 / 2011
../..
$9.00 / 2019
$9.50+ / 2020

And that's only a $.50 increase per year, which as all you math-conversant fellow members understand is a decreasing rate of increase.

My Prius is my insurance policy for the shortterm.