Hofmeister Sees $120 Oil, Fuel Shortages Ahead

Amid a backdrop of lingering uncertainty and stringent regulations bottlenecking future offshore production, an aggressive campaign to push alternative energy resources has begun.

And while a turning of the tides might bode well for the world's largest oil consumer in decades to come, the near-term reality is far more grim, according to former Shell Oil president John Hofmeister, author of Why We Hate the Oil Companies: Straight Talk from an Energy Insider (Palgrave Macmillan, 2010).

Currently the head of the not-for-profit Citizens for Affordable Energy, which educates the masses on energy-related initiatives, Hofmeister told FoxNews.com he believes Americans will likely face oil shortages and rationing by decade's end.

Meanwhile, "it is pure politics that keeps us from drilling more of our own resources (in the U.S.)," he said in a Dec. 27 interview with FoxNews.

And because of what Hofmeister calls "partisan paralysis" in the political process, the nation could face undesirable consequences as the current administration hinders the expansion of offshore drilling exploration to tap domestic resources.

"(Any) punitive legislation…in my judgment will result in serious redirection of investment efforts by major companies away from U.S. natural resource development," Hofmeister previously said in a webinar with Oil and Gas Investor editor-in-chief Leslie Haines.

So what, exactly, can Americans expect to see, particularly at the pump, in the coming years? Try $120-per-barrel oil and $5-per-gallon gasoline in the next two, followed by off-kilter supply and demand and energy shortages between 2018 and 2020, Hofmeister suggested to FoxNews. The senior executive also drew comparisons to fuel rationing during the 1970s.

However, such supply-related problems spurred by near-sighted energy policies during the next decade will be "cumulative and won't happen suddenly," Hofmeister conceded.

To curb supply shortages, Hofmeister supports an idea counter to the Obama admistration's recent bans: expand domestic exploration. This remains a primary means toward U.S. energy independence, industry advocates point out, especially as alternative-energy research and alternative-energy options could ultimately be too slow-going or costly to meet long-term demand expectations.

In the meantime, oil prices are already touching late 2008 levels. As of Dec. 27, the near-month WTI oil price held its ground at $91 per barrel and gasoline prices kept well above a $2 threshold. But across the nation, average gasoline prices have peaked for the season around $3 per gallon, FoxNews reports.

Related Information:

Hofmeister Tells It Straight, No Chaser: America Must Champion Better Policy Or Face Energy Abyss