Former Oil Exec: Get Ready for $5-a-Gallon Gas in 2016
Though you might be enjoying the savings right now, one former oil executive is warning that you shouldn't get used to paying $2 a gallon for gas.
The national average for a gallon of gas is down to $2.05, compared to $3.29 a year ago. It's the lowest average price since early 2009.
But John Hofmeister, the former president of Shell Oil, believes that the big dip will be short-lived, with prices soaring as high as $5 a gallon by late 2016.
Hofmeister believes the cost will spike again as supply dwindles and demand jumps.
FBN's Lauren Simonetti discussed the comments with Jenna Lee today after speaking directly with Hofmeister, who now heads up Citizens for Affordable Energy.
He pointed to the fact that hundreds of oil rigs in the U.S. have gone out of business since since late last year as companies cut back on oil production. That, he believes, will start to affect supply.
Hofmeister also observed that none of the big energy companies ever expected demand to dwindle this much in China, India and Europe.
He told Simonetti that the "glut" of oil on the market right now will eventually dry up and demand will come back.
"How will we meet that demand? Expect it to be 100 million barrels a day by 2020. We might not and that is very conducive to gas prices more than doubling from what they are today," she explained.