Since the current boom in oil prices is accompanied by no apparent shortages, it is pretty evident that it is the product of speculation by oil futures traders. The single thing that can change the cost of future contracts is the perception that oil will be available at the delivery date of such a contract at a lower price. (Of course, as the delivery date of such a contract nears the market price gets progressively less speculative.)
The Saudi King just announced that they plan to increase oil production to bring the price down. Simply announcing that will make it so, just like the Saud's previous announcement they would not increase production made the price leap. It's time for the speculators to get out and leave somebody else holding the bag!
In the longer term, Ardy is absolutely correct (except for the little million=>billion transposition error): We need to do everything we can to develop alternatives to oil as our main energy source. It may have already reached the point that its future value is higher as a chemical feed stock and for making lubricants, than for burning in vehicles and power plants.
