Cost should factor in. The cost for E-M extracting oil has not gone up in the Gulf or in Texas. The cost for refining hasn't gone up.
I get what you're saying, but I think utee's point about it being a global market can't be overstated. It's ultimately a function of supply/demand. Even if we're not getting much O/G from the middle-east, scarcity in any sector of the market means a decrease in supply. I think long-term, if the current conditions stabilized and companies had the chance to permanently and securely adjust their strategy, with the potential for segmenting off certain markets (like, say, ours), then you'd be correct in assuming prices could remain lower. But while they're all tied to the same fluctuating circumstances in a piece of the market they all share, it's bound to happen. Think Thomas Sowell, Basic Economics....whatever other factors seem important, supply/demand is undefeated, for good reasons, and it's ultimately to everyone's advantage if things function that way. If the price was X and supply decreases, the price will increase from X.
If we got no oil from the middle east and prices spiked, that'd be gouging, I guess. As long as we rely on some percentage and are considered any part of their market, I don't see how rising prices can be avoided, without artificial interference, which usually doesn't work out how anyone intended.
