At $120 per barrel, the oil companies are paying $2.86 per gallon for raw crude. On the average, state and local taxes are $.65 per gallon. Refining and transportation are fairly costly. In other words, given the cost structure, gas would average $3.50 a gallon even if the oil companies made no profit at all.

Relative to the massive cost of goods, it's virtually immaterial to the consumer whether the oil companies make ten cents a gallon or twenty. That's only ten cents out of four bucks. A drop in the bucket. I'm not suggesting that the oil companies should make more profit per gallon, or less, just observing that their profits, massive though they are in the aggregate, are virtually insignificant in their impact on pump prices. Even if they give it to us without making any profit, it would still cost us some $3.50 a gallon. The only way to get REAL relief on the retail prices, to get them below $3.50 a gallon, is to lower the cost.

Is that going to happen? Probably not. If anything, prices will continue to increase, because world demand for petroleum will continue to increase. The United States did manage to reduce consumption slightly in the period 2004-2007, from 20.73 million barrels per day to 20.70, but at the same time, the rest of the world increased from 61.60 to 65 (2007 estimated). In other words, if the United States had reduced demand by 15% in three years, total world consumption would still have increased! This trend is likely to continue. Even sharp reductions in American consumption will still result in world consumption increases, and therefore probably higher prices as well. I just don't see that changing.

(By the way, gas costs more than eight bucks a gallon in all the major European countries, and is approaching ten bucks in some of them.)

"The only real solution to the gas price crises is conservation. Only when the demand for gas falls will price of gas will go down."

American conservation is not going to affect the solution. Even if the USA had reduced petroleum consumption by 15% in the past three years (and a decrease that large would have been a quixotic goal), total world consumption would have increased. Thus, even if one accepts your contention that a reduction in demand would drive prices down, the point is that there is not going to be such a reduction. Some very large countries are industrializing rapidly, and a reduction in American consumption is not likely to be enough to offset that.

Churchill2004: brainiac-dumdum: sacrifice for the greater good is the American way

Silly me, I though it had something to do with freedom and individual liberty.

Don't confuse selfishness with freedom and individual liberty.