Gasoline may have been $1.88 in 2004, but the latest average gasoline price is $2.22 (see
http://www.fuelgaugereport.com/ ), which is getting closer to the $2.87 (in 2004 dollars) of 1980.
I think just as important as the price of a commodity is the rate at which the price changes. So if gasoline goes up $1/gal over 5 years, that is less of an economic shock than if it goes there in 2 years.
Anyway, ceertainly current oil prices are not as much of an economic negative as the oil prices of the late 70s/1980. They're not as high (inflation-adjusted) and we use less oil per dollar of production than we did 25 years ago.
But oil is still very important. If you compare a long-term chart of GDP with a chart of oil prices, long-term meaning over the past 40 years, it is pretty remarkable - every time oil prices rise sharply and by a lot, the US economy either goes into a full-blown recession or a growth recession (growth slowdown). This relationship is well-tested - economic models almost all use oil prices as a major input.
Let's hope the speculators get blown up soon.