Fresh violence in Iraq has seen oil prices surge to nearly $50 a barrel.
New York light crude reached $49.27 a barrel for the first time in European trading and the UK benchmark, Brent crude oil, recorded a fresh high of $45.15 a barrel.
Analysts have warned that prices could continue to rise.
However, the president of oil cartel Opec has said that the group will wait until its next meeting in September before taking any action.
Should we be worried about the surge in oil prices? Is oil a gift or a curse? How would we cope without it?
This debate is now closed. Thank you for your comments.
The following comments reflect the balance of opinion we have received so far:
Do any of the people claiming to welcome an oil price rise actually need a car for anything, or are they simply so rich they would just prefer it if the roads were kept empty for them alone? What a load of nonsense. Average people will just be a little bit poorer, we'll still use petrol cars and the alternatives will still be unviable for a long time.
Maybe newer ways of working and living need to be explored. Perhaps there should be a justification for the daily commute. I'm sure most people who sit at a computer all day can work from home. I appreciate that not all jobs can be done this way, but any reduction must be worthwhile.
Richard Crossley, Ireland (Ex UK)
It is good that prices of oil change according to market forces. If we are on the verge of running low on oil supplies, then the rise in price will stimulate development of new energy sources. Necessity is the mother of invention.
Eric Cohen, USA
While the price of crude oil is increasing, the price of gasoline at the pumps in the US is coming down. Nothing to do with the upcoming presidential election, of course. Will the same happen in the UK? I doubt it.
Barrie, Harlow, UK
The surge in oil prices will create inflation, unemployment and pressure on world governments. The fact that oil is running out has been known to the developed world more for than 50 years. However, there doesn't seem to be much effort to introduce alternative fuels. Oil companies, oil affiliated politicians, petrochemical industries and car companies are unwilling to seek for alternatives. The world is at peril when it come to oil.
Wayne Soon, Singapore
Short term it bites, long term this is great news. Governments will have to look for more sustainable ways to develop their economies.
Demetris Zisimides, Nicosia, Cyprus
As a disabled driver I am very worried about oil prices, however, I am sure in my own mind most of this horse trading is more to do with oil company profits than genuine shortages.
Michael Mciver, England
I hope it goes to $1,000 a barrel. Our addiction to this inefficient and dirty fuel needs to come to an end. Once the big oil companies stop blocking the unavoidable rise of alternative fuels, the sooner we can move on.
Kevin, Chicago, USA
The sad part is that high oil prices are the only way conservation and alternative energy sources will make economic sense. Most people simply aren't going pay an extra $10,000 for a hybrid car if they won't get a return on their investment, even if it is the right thing to do.
Christy, St Louis, USA
I was not concerned at first however now I am. Stability must be maintained in the Middle East or we will be buried in these outrages prices.
Loren, Chicago, Illinois
It's great news. Double the price and the lazy people who drive kids to school, pop to the local shop will think twice. If it's dear enough we won't have to build more roads and expand airports. It may even bring community back to local areas.
T Newman, Bournemouth, UK
I hope that prices of oil triple. Only then we shall discover that there are other cheaper and cleaner sources of energy easily available, such as atomic plants, hydrogen (fuel cell) cars and the latest generation of solar panels and converters. Our technological and logistical inertia has been caused by ridiculously low prices of oil. Unless they go substantially up - nothing will ever change for lack of incentives.
Mirek Kondracki, Katowice, Poland
On the contrary, I am quite pleased about the rising oil costs. I sell scooters - they are cheap to run and they definitely are better in traffic jams and are more environmentally friendly. So rising oil costs will merely show us how the car is not really the star.
The wealthy ones will not worry very much for now. But those who struggle every month with their mortgage, rent etc. will have to think twice before deciding on any new expense.
Ignacio Moreno, Madrid, Spain
I am very concerned about the growing oil prices and growing energy crisis. I have been studying peak oil now for the past six months and I don't think the world/general public are aware of how serious an issue this is. I would seriously advise people to start paying attention to peak oil and prepare for the long term affect it will have on the world's economy. I don't think enough of the general public realise how much the oil industry is in our everyday life. Take oil out of the equation of everyday life and industry, transport and agriculture etc will quickly collapse. Peak oil and rising costs will affect more than just prices at the pumps.
Keith Montgomery, Glasgow, Scotland
I work in the oil industry and my feeling is that prices have been ridiculously low for years now. Even at $50/barrel, (roughly 70p/gallon), crude oil is significantly cheaper than bottled water! A realistic price for a depleting resource may be double this!
Mark Buyers, Aberdeen, Scotland
Isn't it about time we started making more use of biodiesel?.. They add 3-5% to all diesel in France without any problems. People should drive more economical cars and drive in a more frugal manor. Just think the days of cheap fuel may be gone forever.
Colin Clayton, Southampton, UK
As an Engineer in the oil industry I am appalled at the current state of affairs. I am not sure if the world is aware that for an oil company to invest say $300 million in a new oil platform that produces 100,000 barrels of oil a day, they can recover their costs in a few months oil production! Just work the math out. The platform continues to produce for another 25 years after that (all profit). The oil companies have milked the world for years. Shell made billions in only the last three months! Why do the governments not force the oil companies to invest more in oilfield development and secure more jobs, more oil and less world oil worries? After the oil companies say an oil field is depleted, it still contains 70% of its original oil reserves. There is no way oil will ever run out in the next two generations anyway. The world needs to reign in the oil companies.
Mark, London, UK
Oil is now far cheaper in real terms than it was 25 years ago. When we are so much richer than countries in the Middle East, how can we complain when they ask a fair price for something so valuable to us.
Simon Grayson, London, UK
It is time for alternatives. It is time for the oil industry to be more flexible. It is time for the US Congress and the UN to take action to encourage investing in alternatives - like fuel cells for cars etc. And it is time for the consumers to be more concerned about the environment.
John, New York, USA
I analyse this stuff. Let's be clear about one thing and that is the price won't go down again. Why? Because at this level, the oil companies don't have to invest to make more money. And - don't be fooled by the headlines in Iraq. The impact on the oil price of the Iraq fiasco is minimal - probably less than five dollars now. The big issue is that demand is close to outstripping production. The smaller the gap gets the higher the oil price. And, with most if not nearly all the easy reserves having been accessed then increasing production enough isn't easy. Small new oil fields found in the North Sea have no impact on this. In fact, even 1bn barrel oil fields found in the Gulf of Mexico will have little impact on this. It's important to remember that the Western oil companies aren't there to supply us with energy. They're sole aim is to satisfy their shareholders.
Why are we not being encouraged to save oil? We're still consuming and burning the stuff like it's never going to run out.
Mark, Chatham, UK
We should be worried as it will increase costs to a huge number of businesses. This in turn will reduce profits/threaten jobs, increase the prices of goods, reduce share prices/make pensions more expensive. Coping without oil would be tough as we don't yet have a good alternative for the internal combustion engine and we would no longer be able to make plastic goods.
Alan, Perth, Scotland
Isn't it time we started investing in alternatives - like fuel cells for cars etc? Or is that just too sensible?
Oil is a non-replenishable resource. Its scarcity or even the mere perception of it becoming scarce will increase its prices. It's about time we began to invest in automobiles that use alternate sources of energy, and improved our mass transit systems.
Gaurav Tripathi, India/USA
Economies have a way of balancing out and the rise in price may be a blessing in disguise. Oil is a finite resource and higher prices should throttle back demand as economies adjust. Also the development of alternatives become more viable which has to be a good thing.
Rex Lester, Chessington, UK
I'm worried, but not as much as poor Gordon Brown. He will need to think twice now before upping his gigantic cut or his friends in Downing Street will have protests to put up with!
Tony Humphreys, Prestatyn, UK
It is time that we prepare for the inevitable. Oil prices should be a lot higher in the US than they are. We are spoiled compared to the rest of the world and we need to wake up and realise this very soon. There is simply too much dependence on it here, and that is wrong. I don't hear either presidential candidate addressing this issue either. We are too distracted by other issues. Oh well, we will find out soon enough what the value of oil really is.
GG, Vancouver, WA, USA
Isn't it strange that we managed without Iraqi oil for 10 years and the price did not rise like this.
Richard Castle, Prestatyn, Denbighshire
Yes, the oil price rises are a major problem. Surely no one would welcome a return to 70's style Stagflation? However, western governments were aware of this problem developing as demand has been outstripping supply (due to the booming developing world economies like India and China) for some time. The West had a choice to either push for a massive expansion in non-fossil fuelled sources on energy (including nuclear) or wage war to secure supplies. Of course neither option would go down well with the British public, but the Blair government (and others) choose to take the country to war instead of taking the necessary alternative measures. What a fine mess they've got us into.
Richard, Preston, UK
Why should I be worried about something that I have absolutely no control over?
Gerry Noble, Salisbury, UK
I think we should devote more resources towards developing alternative energy sources. As the leading consumer of energy, the US might explore technologies such as at rice-based fuels and then invade Asia.
GC, San Francisco, USA
Bad, Bad News. Analysts keep saying that the rises aren't as serious as the 70s and 80s, but no analyst will deny that crude price rises over the last year or so have been significant. The significant world-wide reliance on this commodity can only have a downward effect on growth and stability. For the UK, this means the possibility of another spate of reductions in the BOE base interest rate to prop up growth. The end result would be massive instability both on the domestic front for the UK, and worldwide. I'm preparing for a recession.
Peter Hubberstey, Preston, Lancashire
Not only no but hell no! It might take $50 oil to finally reduce our dependence on middle eastern oil. Let's drill in Alaska, pump money into building a ethanol infrastructure that covers the entire US, and permanently shift our focus out of the otherwise useless middle east.
T Durden, Ames, Iowa USA
Let's see how happy the people who now say they are glad oil prices are high and rising are when the reality of the consequences hits home. Let's see how they will like seeing their home heating bills skyrocket this winter, their bus and train fairs shoot up, their cab rides increase, and the cost of everything even remotely related to oil get much higher. I'll bet they will be the first to scream and they will scream the loudest and longest but it won't do them any good then.
Just goes to show we can't even trust Bush's best friends ...
Ian, Brit in USA
No. My wife owns an oil well.
Richard Hicks, Amarillo Texas USA
Cheap oil has made a world population of over 6bn possible. It's the people in the developing world that will suffer most. A sudden increase in oil prices will lead to famine and war.
Ian R, Newark, UK
Now is the time Nigeria should use all the profits from this windfall to pay down the debt. We cannot afford to squander this opportunity. But if those in power refused to pay down this debt history will not be kind to president Olusegun Obasanjo and others. We knew what happened to the billions of dollars Nigeria made in the 1990 during the first Iraq war: the bastards in power then stole the money.
Ganny O. Ogunshakin, Silver Spring, Maryland, USA
Oh please, are we now going to be subject to an increased fuel rise? The UK has one of the biggest oil fields (north sea).Why are the petrol companies making such a problem of this Iraq issue? Maybe it's because we the consumer forget that the oil and petroleum we buy today was purchased at a lower price two months ago. We have stocks of fuel bought at the lower price yet your local station can and will charge as much as 98.9 for fuel. Our fuel stations are also to blame for the massive fuel increases.
Craig, Wirral, UK
My compatriot must be one of those few, happy people who can afford to pay tripled price for oil without ruining his family budget. However good is the idea of alternative sources of energy, in my opinion the surge in oil price doesn't seem to be the best way to introduce it. For most ordinary people it would be simply unbearable.
Marek, Gorzów Wlkp. Poland
Well, it makes "peace" in the Middle East more distant. We should expect another "wmd" war with Iran. Of course to control oil!
I hope the government spends the enormous amount of extra revenue that is being generated from the North Sea wisely! Or is that wishful thinking?
As already mentioned, oil is cheaper now in real terms than in previous times. I believe we need a steady increase in prices to help us make the transition to renewables. Instead of less taxes, we need more: to factor in the external costs of oil such as global warming and pollution. The rise in market prices only benefits the oil companies and producers; to gain social benefits taxes are required. Governments should therefore act to ensure that oil (or oil products) remains at and above its current level, and that prices increase in real terms in the long run.
Oliver Knight, London, UK
While the price of oil is rising in dollar terms over the past 18 months, the dollar has also collapsed against the pound and euro in the same period, the effect of the oil rise for the UK in terms of pound sterling is therefore not as severe as it sounds.
Philip Thompson, Keele Uni, UK
People are mostly concerned with the additional cost of fuel that rising oil prices bring. There is a lack of understanding of the economic and social consequences that it could have. Without oil and other dirty fuels we would not have power - which in turn would bring the global economy to a stand still.
Higher oil prices mean lower growth. Lower growth means fewer jobs. What's the point of allegedly saving the environment if we have poverty and economic stagnation?
Richard, Brentwood. Essex.
I believe oil prices will continue to rise however the top oil consuming nations will not reduce consumption because of that. Oil is still plentiful but just more costly. Alternatives to oil, wind, solar and tidal power, are still regarded in some countries as curiosities and not taken seriously. We would have difficulty coping without oil.
Charles, Montreal, Canada
I have really not seen the negative impact of rising oil prices yet other than a slight increase in gasoline prices at the pump. On the contrary, as a Chemical Engineer, I see a lot more activity in the oil and petrochemical industries globally and even somewhat locally too which is great for me personally. However, this must hit home soon since the higher cost of oil has to translate into higher prices in so many other areas that use oil directly or indirectly as a raw material for products produced. For example if you are an ice cream maker and you buy more expensive milk to make ice cream, sooner or later you have to raise the price of the ice cream you sell (unless you can afford to absorb the extra cost of the milk).
John, NJ, USA
$50 for a whole huge barrel of oil sounds bloody cheap to me, in view of the fact I have to pay more, £40, to fill up the little tank on my car every week. The understandable price hike wouldn't be nearly so significant to the consumer if the government didn't multiply this figure several fold in the excessive taxation process. I bet Blair and Bush are loving the consequences - do nothing to stop oil prices rising and thereby multiply the tax revenues and get rich quick!
James Hooker, Swansea, Wales