For the first time in history, the United States faces continued prices of $100+ barrel oil.
The price of oil has risen to its highest level ever on an inflation-adjusted basis; crude oil
on March 3, 2008, reached $103.95 a barrel (in 1980 oil reached $39.50 a barrel, which
translates in inflation-adjusted 2008 dollars to $103.76)1. Average vehicle miles driven
have risen steadily on a national basis since the 1970s (rates rose more than 150%
between 1977 and 2001, according to The Wall Street Journal2), thus the effect of these
high prices are likely to reverberate throughout the economy, despite greater fuel
efficiency.

The growing use of oil in developing nations, particularly in China and India, has put a
strain on the ability of global oil suppliers to meet growing demand. A major automotive
manufacturer (BMW3) and oil analysts4 are predicting that global oil supplies may be
peaking within the next 3 to 20 years. Should this happen, the overall global oil supply
will not be able to meet increasing global demand, thus forcing up oil prices to levels
impossible to currently predict.

This study was made under the hypothesis that certain U.S. cities and metro areas are
currently better prepared for higher oil prices--or potential oil supply disruptions--than
are other cities and regions. A further assumption is made. Cities or regions that have
existing significant alternatives to reliance on oil for transportation and alternatives to oil
for building heating and electricity generation will fare better economically if oil prices
remain above the barrier of $100 a barrel oil.

Download the full report here.