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Former Shell Oil president John Hofmeister breaks down the link between gas prices and consumer behavior.
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-- -- -- The price of oil everybody plunging hitting its lowest levels and eight months and part because of last week's dismal jobs report.
Now while this may bring -- already is bringing -- that the pop.
My next guest says if we don't take action oil and gasoline prices are only going to go one way that is backed up John pop Meister.
The former president of shell oil and he is joining us now.
Why -- higher prices necessarily a bad thing John if it changes our behavior.
And reduces how much we use which we are clearly seeing in recent years.
Well high prices this simply government failure.
To take advantage of abundant natural resources.
In the domestic US marketplace.
It -- high prices are really a drain its attacks on the consumer.
Driven by politicians unable to make policy decisions because disposable income is decreased by high gasoline prices.
Causing the average consumer to put off other purchases.
And now this is the third year in a row -- and where we have seen high gas prices change consumer behavior.
In the spring to early summer leading to market -- -- leading to slower growth.
And this is gonna continue as a pattern until we finally get some leadership in Washington willing to do something about the future of domestic oil production.
We haven't had leadership on this issue in at least forty years.
Period there has not been that's a -- -- -- there's no policy so why even hold your breath for hope.
In any coming administration.
What has changed dramatically.
In the last say ten years has been the rise of the economies of Asia.
Particularly China and India and the inability of the world outside the US to keep up with global oil demand.
And when you get prices of a 147 dollars a barrel which we had in 2008.
Or -- 125 dollar Brent which we had just this spring.
Those are indications that the world can't keep up.
And the biggest consumer nation and -- kind in the world the United States of America with the most abundant natural resources in the world should be picking up.
It's burden.
To supply its own people with affordable energy and the failure to do that really does cut across a -- president.
And you always say affordable.
I mean we worry about supplies but why is cheap fuel all right in this country not point -- That when you have higher prices it is naturally caused us to change our behavior and a good way.
With -- government mandates.
In with Al government intervention.
But we have 250 million cars on the road.
We have a -- -- society.
We have built the infrastructure to have mobility we have not built the infrastructure for public transportation.
We have not done anything in the last forty years.
But induce people to buy more cars to enjoy the freedom and individual freedoms.
That capitalism delivers in a market economy -- and I see no reason to move away from a marketing -- OK John lost yet thank you that I knew I was gonna happen apologies John John pop Meister but you did get the final -- -- thank you so much we'll see same.
