Compared to the 99 cents a gallon in 1999, prices have gone up big time in constant value. The price index has not doubled since then, yet the price of gasoline has more than doubled.
The thing to keep in mind, though, is that the price of oil was unusually low in 1999. Oil companies were losing money. Anytime you have an industry losing money, you know that the price is ultimately going to go up. Companies in that industry are going to shut down capacity because it's not profitable, and as they do, the price will rise.
True, but if you look at the price of gas since the 1980's when it was much higher, the price today is about the same. Prices rise and fall, but over the long run they haven't increased that much.
As the oil companies adjust to the increased demand from Asia and the supply disruptions from Katrina, the price will continue to fall.