Stan asks an excellent question:

If consumers are willing to pay higher prices for gasoline, why should we think that energy companies are going to do anything but charge those higher prices?

I'm not one who blames oil companies for high prices.  I'm more impressed by how quiet the media gets when oil prices are low.  In the U.S., we act as if God decreed low energy prices. We act as if the laws of supply and demand don't apply to us.

You don't have to spend much time driving in Europe to see the difference that high gasoline taxes make.  People drive smaller cars, mostly diesel fueled, and public transportation is first class.  People also live very close to their jobs and to all the services they need.  They actually walk to market.  What a concept?  It keeps you slim too!  Try walking to most U.S. stores, and you're very likely to end up as a pedestrian fatality.

Oil is undoubtedly a private good, but it's one that takes a lot of investment and a long time to bring to market.  As we economists like to say, oil supply is quite inelastic in the short-run and inelastic in the long-run too.  Demand for oil is quite inelastic in the short-run and inelastic in the long-run too.  Therefore, price volatility is to be expected.  However, despite repeated experience to the contrary, Americans never seem to get used to oil price volatility.  Neither does our government.

Our federal and state governments subsidize gasoline, tax gasoline, restrict the refining of gasoline, impose stringent air pollution requirements on the refining and use of gasoline, and fail completely to buffer the price volatility of gasoline.

An economist facing such a situation would generally recommend a variable tax to even out such price volatility and to establish a rational long-run incentive to increase oil supply, to increase conservation of its use, and to create alternatives.  We simply don't do that.  What more proof do we need than highways full of SUV's and an army of unemployed auto workers?

We did establish the Strategic Petroleum Reserve in 1975, but we restricted it's primary mission to "national security" and not to "economic security."  Furthermore, it stores crude oil, not gasoline, so it's of little short run use.

Our refineries are operating at peak capacity, and there's no spare capacity to be had because we don't like foul smelling air near any of us.

What to do???  As my kids say, "DAAAAA!!!" Cut back on the use of gasoline, establish a variable tax to stabilize its long-run price, and develop alternative fuels.  We have the know-how; we have the ability; we just lack the will.