I lived through the 78-83 price spike as a college student struggling to cover commuting costs etc.  There is a price where people just stay home more.  

It's more pyschological than anything else for many.  When we get bored in the evening and head to town for ice cream, it costs us about 1/2 gallon of gas or $1.50 to $2 bucks. That's to go buy $8 bucks at the frozen yogurt place.  Does the last 50cts matter to us?? no, but I think about it more and often it tips the balance to staying home.  I've cut my driving back by probably 50% just by grouping errands better.  It's no real sacrifice when you are basically retired.  My wife's biz is booming so she just does what she has to and pays the piper.  Gas could go up by 5X and she'd still go.  But we'd buy a hybrid asap.

For others with moderat to low incomes and heavy commute costs, this is serious pain.  They have no choice but to trim.  Demand in the US is so stupidly high relative to everywhere else that trimming 3% is nothing though.  We could all find a way to trim 10% if we wanted to make a few minimal sacrifices.