Not really. Gasoline is much more like a utility than a commodity in its demand. There is somewhat of a captive market controlled by an oligopoly. In a normal market what you say is completely true but with oil it becomes distorted.
First there is the sunken costs. Someone who pays $20k for a car doesn't have the luxury of abandoning it when oil prices jump. The same is true with home heating and such. Second, even if they could, the alternatives are even more costly and it would seriously disrupt the lifestyle of most people. Getting to and from work or the store is essential to most people and public transport (where available ) doesn't eliminate the usages - it just transfers who pays the costs. Finally, population growth and urban sprawl means more usages even with conservation efforts and increasing efficiency. You could say it is somewhat of a captive market.
While there are limits to some of this like collapsing the economy,(like leading up to 2008) there is a lot of room before that happens. There is almost a guaranteed volume of sales and increases over time. Efficiency and alternatives slow the increase but have yet to replace it.