Keep in mind that a significant part of North America's oil production is non-conventional (read expensive). If oil drops too much, supply that is economical to produce will go way down. The oil sands depend on oil at $30/barrel to make any profit. Anything below that and billions of dollars go up in smoke. Ditto for drilling in war zones, deep wells in the gulf, etc. Oil production may indeed increase, but only on the back of a higher price. If we see gas at $1.15 a gallon again in the US, it won't be for long...