Fox News had a psychiatrist on this morning who said that the people who do this sort of thing act with zero regard to consequences of their actions. That is, they cannot be counted on to act rationally.
During the "cold war" the USA and the USSR had many nuclear tipped missiles aimed at each other. The assumption was that no matter who struck first, both sides would suffer an unacceptable level of destruction.
We cannot count on this with Muslim countries. In other words, even if they know we will retaliate they will attack us over an insult to the Prophet.
IMO, this is an act of war, but I favor a measured response. Something like trade sanctions (assuming they can be enforced) financial penalties, and the likely expelling of the Libyan ambassador to the USA. Certainly, this would put US financial aid in jeopardy. These are all possibilities. For example in Egypt, most or all of the aid goes to the military and we do have a lot of influence there. Canceling that aid could backfire.
We need to drill for petroleum everywhere or we risk getting the foreign sources cut off. I don't think anyone wants to send US troops in harms way in the middle east for oil.
Edit, since I have heard more recent reporting on this incident I now believe it was a hard core terrorist attack planned to coincide with 9/11.