From the mid-1980s to September 2003, the inflation-adjusted price of a barrel of crude oil on NYMEX was generally under US$25/barrel in 2008 dollars. During 2003, the price rose above $30, reached $60 by 11 August 2005, and peaked at $147.30 in July 2008. Commentators attributed these price increases to multiple factors, including Middle East tension, soaring demand from China, the falling value of the U.S. dollar, reports showing a decline in petroleum reserves, worries over peak oil, and financial speculation.
For a time, geopolitical events and natural disasters 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 an insignificant impact on oil prices given the onset of the global recession. The recession caused demand for energy to shrink in late 2008, with oil prices collapsing from the July 2008 high of $147 to a December 2008 low of $32. However, it has been disputed that the laws of supply and demand of oil could have been responsible for an almost 80% drop in the oil price within a six-month period. Oil prices stabilized by August 2009 and generally remained in a broad trading range between $70 and $120 through November 2014, before returning to 2003 pre-crisis levels by early 2016, as US production increased dramatically. The United States went on to become the largest oil producer by 2018.
