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Is Cellulosic Ethanol Always the Bridesmaid?

User161183 - I think Mr. Dikeman was saying that processing oil into gas adds 50 cents per gallon, not that the final cost would be 50 cents. You still need to add the raw cost of the oil into the final cost. At least, that's the explanation that makes the most sense, since as you state, we won't see 50 cents/gallon at the pump ever again.
People here aren't really talking about peak oil, but we're at the onset of it now. That's why OPEC isn't raising their production quotas, despite record high prices (about 5 years ago they said $35/barrel was their target, otherwise people would pursue alternatives and conservation). They can't raise their production (stability in Iraq/Nigeria would help, however), so I would not be surprised to see $130/barrel by the end of the year. Any price drops will last less than 1/2 year, as it continues its relentless climb.
Hopefully the next president will be a lot more open to R&D and incentives for cellulosic ethanol, as that will be our only possible route to some degree of economic stability and avoiding utter dependence on OPEC in the next decade.
Cellulosic ethanol may take some cropland, but it doesn't have to be the high-maintenance, rich soil that corn requires with heavy pesticide and fertilizer requirements. Switchgrass for instance can be grown on non-irrigated acreage even in dry climates. If we can use lumber/tree leftovers from logging and construction, that would be another big source free of current crop production. But conservation will be an essential component of future plans. No passenger vehicle should get less than 30 mpg, for starters. We've got a serious problem and it takes hard answers sometimes.