The price of oil was near $40.00 for much of the late 80's-early 90's, and I don't recall terrorism stopping, so I'm not sure this cause and effect senario has worked in the past. Those $40.00 a barrel prices sure did hurt our domestic industry though, in fact, it was nearly decimated. The Middle Eastern fields,though, could still produce oil at a profit (although not as much of one).
Financing terrorism is not a either/or proposition. It’s a question of degree.
The more they are de-funded, the less money they have to spend developing nukes and other weapons, the less money they have to buy influence, the worse their economy get and more restless the opposition party at home becomes.
The other, and more important issue, is that if the U.S. is not dependent on oil from the MidEast, then strategic decisions regarding the MidEast don’t have to take into account possible interruptions in the flow of oil. So, it is about the price of oil, but it’s also about reducing our dependence and interaction with that screwed up part of the world.