Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Ex-Shell president sees $5 gas in 2012

chart_gas_101227.top.gif By Laurie Segall, staff reporter


NEW YORK (CNNMoney.com) -- The former president of Shell Oil, John Hofmeister, says Americans could be paying $5 for a gallon of gasoline by 2012.

In an interview with Platt's Energy Week television, Hofmeister predicted gasoline prices will spike as the global demand for oil increases.

"I'm predicting actually the worst outcome over the next two years which takes us to 2012 with higher gasoline prices," he said.

Tom Kloza, chief oil analyst with Oil Price Information Service says Americans will see gasoline prices hit the $5 a gallon mark in the next decade, but not by 2012.

"That wolf is out there and it's going to be at the door...I agree with him that we'll see those numbers at some point this decade but not yet." Kloza said.

"The demand is still sluggish enough in some of the mature economies."

Gasoline prices have been steadily rising. Last week, gas prices crossed the $3 mark for the first time since October 2008. According to AAA figures, prices are up 4% from a month ago and 16% from the $2.585 average a year ago.

A study from the Oil Price Information Service estimates drivers will spend $305 on gasoline in December. According to the study, fuel prices are up 13.6% from last December and 76% higher from December 2008.

Gas prices eased off last week's gains but still remained around the $90-a-barrel mark, settling at $91-a-barrel. Prices were down 51 cents from Thursday's close after China unexpectedly raised interest rates over the holiday weekend for the second time in two months.

Oil prices settled above $90 a barrel for the first time since October of 2008.  To top of page

Overnight Avg Rate Latest Change Last Week
30 yr fixed3.92%3.81%
15 yr fixed3.12%3.03%
5/1 ARM3.17%3.15%
30 yr refi3.91%3.80%
15 yr refi3.11%3.03%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:
Index Last Change % Change
Dow 20,975.09 -21.03 -0.10%
Nasdaq 6,025.23 -0.27 -0.00%
S&P 500 2,387.45 -1.16 -0.05%
Treasuries 2.31 -0.02 -0.69%
Data as of 5:23am ET
Company Price Change % Change
Bank of America Corp... 23.89 -0.09 -0.38%
Ford Motor Co 11.60 0.12 1.05%
Chesapeake Energy Co... 5.47 -0.04 -0.73%
General Electric Co 29.26 -0.19 -0.65%
Advanced Micro Devic... 13.41 -0.08 -0.59%
Data as of Apr 26

Sections

U.S. economy started the year with sluggish growth under the new administration. But overall the U.S. economy is in solid shape. More

Chris Sacca, an investor known for his early bets on Uber and Twitter announced Wednesday that he will stop investing in startups. More

Homeowners who sold their home in the first three months of this year saw an average price gain of $44,000 from purchase, according to a new report. More