The local daily newspaper (Idaho Statesman) is reporting here that according to the AAA, $3.50 gas is in our near future.
Traditionally the price of gas is a supply and demand thing. I believe that means, as demand goes up, the price tends to do the same. As supply goes up (which is unlikely; experts say oil supplies have "peaked out" and are on the decline), prices tend to drop.
The article suggests that prices now rise or fall depending on perceived threats to the supply. (To me, that seems like an interesting detail... but it's still a supply/demand market.)
As is usually the case, the "experts" have weighed in with their expert commentary. (See the comments following the article.) Most of them seem to ignore the fact that there is indeed a finite supply of fuel, and also a limited amount of refinery capacity. Many also seem not to understand the fact that worldwide demand is skyrocketing, what with the new prosperity in places like China and India. (The comments are the usual diatribes about Alaska oil being the answer to all our problems, fuel tax elimination, Bush and Cheney, blah-blah-blah.)
Each person who uses fossil fuel should consider how he impacts the supply/demand, in some small way. I'm getting cheated, since I contribute very little to the demand curve. (And frankly, I resent that by the time I'm "out to pasture," it may be much more expensive than I ever anticipated, to get behind the wheel of some kind of gas-powered transportation device and go see places I've never seen. That's my dream. I oughtta be able to buy "reserve" gas at 1986 prices, to be used in the future.)
UPDATE 10 January 2008:
The Statesman is conducting an informal online poll today, asking people how they will respond.
The results (from 976 submissions) so far:
Take fewer trips: 45%
Grin and bear it: 39%
Boycott gas: 6%
Bike or walk: 6%
Buy a hybrid: 3%
Ride the bus: 2%
(I s'pose you could say that choosing to bike or walk or ride the bus is a way to boycott gas. If you don't choose one of those options, how will you boycott gas? Stay home?)