From the mid-1980s to September 2003, the inflation-adjusted price of a barrel of crude oil on NYMEX was generally under $25/barrel. During 2003, the price rose above $30, reached $60 by August 11, 2005, and peaked at $147.30 in July 2008. Commentators attributed these price increases to many factors, including reports from the United States Department of Energy and others showing a decline in petroleum reserves, worries over peak oil, Middle East tension, and oil price speculation.

For a time, geo-political events and natural disasters indirectly related to the global oil market had strong short-term effects on oil prices, such as North Korean missile tests, the 2006 conflict between Israel and Lebanon, worries over Iranian nuclear plans in 2006, Hurricane Katrina, and various other factors. By 2008, such pressures appeared to have a insignificant impact on oil prices given the onset of the global recession. The recession caused demand for energy to shrink in late 2008 and early 2009 and the price plunged as well.

However, it surged back in May 2009, bringing it back to November 2008 levels. The price of crude oil in 2003 traded in a range between $20–$30/bbl. Between 2003 and July 2008, prices steadily rose, reaching $100/bbl in late 2007, tying the previous all time inflation-adjusted record set in 1980.

A steep rise in the price of oil in 2008 - also mirrored by other commodities - culminated in an all time high of $147.27 during trading on July 11, 2008, more than a third above the previous inflation-adjusted high. High oil prices and economic weakness contributed to a demand contraction in 2007-2008. In the United States, gasoline consumption declined by 0.4% in 2007, then fell by 0.5% in the first two months of 2008 alone.

Record-setting oil prices in the first half of 2008 and economic weakness in the second half of the year prompted a 1.2 million bbl/day contraction in US consumption of petroleum products, representing 5.5% of total US consumption, the largest decline since 1980 at the climax of the 1979 energy crisis.

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