Blue, you don't overpost, and when you post you usually have something good to say. Our world is being overtaken by the money velocity proponents - the Bernakes and Krugmans of the world - and their beliefs that any dollar not exponentially increased by debt is wasted. Couple this with competitive and perpetual devaluation of fiat currencies world wide. This causes the cyclical waves of asset inflation as money pursues return ever quicker - it can't stand still or it will lose its value, by design! Consume or lose - to save you must work at it to maintain the value of your savings. Much easier just to throw up your hands at the whole situation, and just go ahead and buy that Plasma TV on credit at the mall. So long as money supply increases, and money velocity increases, all asset prices will increase, largely delivered by momentum investment. And there's very little to worry about - choose the wrong investment, and time will bail you out of it (not really, but it will feel like it, so you will spend more and increase money velocity, etc...) I laughed at Golden Snack's prediction of >$100 oil 6 months ago with oil in the mid 50's. Perhaps I should not have been so hasty or haughty. However, I doubt that such a move will be based on fundamentals - it will be speculation that drives the market, with hoarding and supply interruptions that escalate it. I can't even concieve of a superspike to over $130 - that would again be a speculative bubble that would collapse on its own self, in the absence of a horrific disruption of supply.
I haven't read through the thread so someone may have beaten me to it. As long as firms can continue to pass through price increases to customers to pay for their increased fuel costs, the market will continue to ignore the price of oil.
The simple answer is they will ignore it until they don't, that's how mkts work. Nobody knows precisely when that is.