Shell Oil CEO: $5 Gasoline Looms on Horizon
by Money News
Gasoline prices, currently averaging a little over $3.93 a gallon, can shoot up in the $4.50 to $5 range later this year, says Marvin Odum, CEO of Shell Oil Company, the U.S. unit of Royal Dutch Shell.
They can also fall off those highs quickly, depending on how fast the world can resolve tensions in the Middle East or other factors affecting demand.
“I think if you look at the range of possibilities of what could happen across the world over the next several months, that’s certainly within the realm of possibility,” Odum tells CNBC, when asked if $4.50-$5 gasoline were possible.
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“But slightly different activities can take it down a little bit the other way. So it is fairly hard to predict in that range.”
Gasoline prices are surging earlier than they normally do thanks to tensions in the Middle East and rising demand worldwide.
More U.S. motorists hit the road in the spring and summer, which will pressure prices higher.
Market factors such as Middle East tensions are out of policymakers’ control, but encouraging more drilling at home can help alleviate rising energy prices down the road.
“It depends on world activities, geopolitics and what happens in the Middle East. The question we have to ask ourselves as a country is how do we produce more of our own and how do we improve that picture from our side,” Odum says.
More than two-thirds of Americans do not approve of the way President Barack Obama is handling high gasoline prices, according to a Reuters/Ipsos online poll.
While most people aren’t blaming the president for high gasoline prices, they do feel he could do more to alleviate them.