From this point of view, raw energy prices are something that should not suffer hardly any inflation adjustment. So why does this keep getting brought up?
You have an interesting point. Although I am certainly not an economist, I would venture to state that the "value of a dollar" is really about its purchasing power...and it doesn't matter what one is purchasing...widgets or the raw energy used to produce them..
So, the purchasing power of our mythical dollar today, in buying say, raw energy, crude oil, or what have you, is still greater than the amount of crude oil it would have bought in Jan 1980.... No difference made between raw energy or what we bought farther on down the manufacturing chain...
Said another way, even though the dollar is worth less today (buys less stuff), we still are getting a better deal on crude oil than in '79...which of course, were the highest of all time..
What these quotes seem to be saying is: "Don't worry. You're still paying less for oil than you did at its highest, and oil is still a good value in that sense." Yessir.
What's even funnier, I think, is that if the value of a dollar in comparison to other currencies (that competitive devaluation thing...) continues to decline...AND it buys us less stuff...the
rate of dollar decline may actually
outpace the rise in raw energy prices..So the goalposts of inflation-adjusted '79-'80 crude prices get continually higher...like $100, $110, etc....keepin' folks complacent....
A lot has been written that the rise in energy prices lately may be just a reflection of the drop in the dollar...For instance, the price of oil in Euros has risen far less than what it is in dollar terms...