This is the graph you need and yes it shows the price of oil is linked to printing. It isn't any more expensive in dollars but as Sterling has devalued against the Dollar it costs UK consumers more.
EROI is now a buzz word in the world of oil production. It stands for Energy Returned on
Energy Invested and relates to the fact that many of the Worlds major wells are now using seawater injection to force the hard to get oil out. Shaybah
http://en.wikipedia.org/wiki/Shaybah was supposed to have a 50 year life (opened in 96-98). This year they are starting the construction of the Natural Gas Liquids pipeline which tends to suggest Shaybah is heading into decline somewhat early.
All this info is easily available on the web and tends to suggest something other than the world being awash with oil
In addition to this the traditional exporters are using more of the stuff themselves now as of course are the emerging economies in Asia, we have all seen the TV pictures of multi lane Highways in places like Dubai and Suadi and Beijing filled with motors. These never existed 2 decades ago and are now having a significant effect on supply or more importantly pushing up the cost per barrel.
Cheap, easy to get to stuff is at peak production. Not only that but we are not discovering any more (in anything like the quantities required to maintain current usage levels beyond a decade or so).
This is not to say oil is running out it is not. As I have said before usage of the refined product has increased exponentially across the world and demand can just about keep up with demand, this of course leads to price spikes.
From this we can deduce oil will continue to rise in price. It may drop in nominal terms in a deflationary environment, but not at the same speed, this would make it even less affordable. The fact that the Government is sanctioning QE means they are pulling out all the stops to avoid deflation.
Maybe the price will fall back again it has before, but the fundamentals this time are somewhat different. Only time will tell what the markets will do in the future.
The UK's problem is that the majority of a cost of a litre is duty and VAT. If this were removed completely we would enjoy some of the cheapest oil in the developed World, it is also fair to say all Countries to some extent or another levy tax on road fuels.
Osborne has said today that the motorist will have to bear the price rises and whatever tweaks he will apply in the forthcoming budget, no doubt this will lead to the unrest Westonman predicts but the Government is stuck between a rock and a hard place.
The UK benefits regime is amongst one of the most generous in the world. The tax raised from road fuels goes a long way towards funding those benefits. What will tip the balance motorists protesting for lower tax or general unrest when benefits are cut? This basically is the choice which we will be faced with. The Country is living beyond its means and has been for a number of years now if we want to be the caring society we are and provide the level of benefit we do then sacrifices have to be made.