War, weather and demand to blame for high gas prices

The last time the market was normal was in January 2003, according to Severin Borenstein, director of the University of California Energy Institute.

That was before the U.S. invasion of Iraq. The economy was still lukewarm and the price of a barrel of oil was in the $20s and forecast to stay that way for another 20 years.

The Iraq invasion led to a huge cutback in production there, eventually taking a million barrels a day off the market. At the same time, the U.S. and world economies improved and demand for oil increased.

Associated Press Business News: Economics 101: Demand Is the Demon - MSN Money