It has precious little to do with the war in Iraq. It has NOTHING to do with domestic oil production. It has only slightly more to do with OPEC. It's all about unregulated commodities trading, the same loophole that allowed Enron to rob California blind before it laid off all it's employees.
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A decade of rising SUV sales and declining fuel efficiencies coupled with a well off middle class that seemed all too willing to pay whatever for gas and commute longer and longer distances may have also contributed.
Valid point. But have you seen/read Enron: The Smartest Men In The Room? The whole California energy crisis was manufactured. The same market speculation loophole that allowed that fiasco is now being used by the oil companies. In other words, there really is no basis to the increases - they're just doin' it 'cause they can. If the war ended today, and we started drilling in every national park and just off the coast of everything, the cost of gas wouldn't drop a penny.
I know there is price fixing going on. Back when SUVs were on the rise (and not yet a dominant force in the auto market) I was certain that it was auto manufacturers working in cooperation with oil companies to increase fuel sales. Once the SUV market peaked (shortly after the start of Bush's first term when he insisted people should get a tax break on the really big SUVs as company vehicles because these were obviously going to be used by construction contractors and we needed to help fuel the booming housing markets and keep them going, which resulted in auto manufacturers upping the weight on their most popular SUVs to make sure they qualified for the tax break and all of a sudden radio stations, tattoo parlors and graphic designers had company Hummers) fuel prices began to increase. They kept on increasing and people didn't stop driving. A thing is worth what people will pay for it. Fuel prices are currently holding steady because the latest round of increases saw people actually try to drive less because they suddenly couldn't afford to fuel up. Once they rework their finances to pay for their driving habits, the prices will go up again but at a decreased rate. The big push is over... for now.
Solid analysis. The passage of the farm bill (a month or two ago) that closed part of the loophole will decrease it as well.
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