(UNDATED) - The former President of Shell Oil Company says get ready for even higher gas prices. John Hofmeister, who currently is CEO of Citizens for Affordable Energy, says he predicts $5 gas by 2012.
Hofmeister says the reason is the economy is recovering to where it was in 2008 but the world is demanding more crude oil than the world can produce.
He says the U.S. produces 7 million barrels of oil per day but consumes 20 million barrels per day.
He says within the next 5 years China will consume 6 million barrels more per day, India will go from 4 million to 7 million and the U.S. will continue its current consumption and production rates.
He says more drilling needs to take place along with replacing old, outdated infrastructure, like coal plants, to meet demand.
He says one example is the new coal gasification plant planned for southern Indiana.
Hofmeister feels there will be no short term effects on oil prices from the Japan earthquake and tsunamis, but he says there will be an impact in a month or so when more electricity is needed in the country.
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