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American Petroleum Institute Senior Economist John Felmy expresses his belief that the U.S. can be energy self-sufficient by 2024.
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He noticed gas price -- the national average for regular unleaded has jumped 44 cents a gallon from just one month ago that's according to AAA.
-- -- twenty cents in the last two weeks alone and that's according to the Lundberg survey.
So these numbers are very -- -- this early in the year have many experts predicting that gas could once again moved above four bucks a gallon.
-- this a lot of increases in the payroll tax.
You know once you punch it finally knocks out the fabled US consumer joins us now -- his take API chief economist John -- John great to see you.
Let's talk friends I was driving gas prices higher more demand that's the usual suspect what else is going on.
But the man clearly is -- also a cost of crude oil was up and the cost of -- so those three factors -- what drove prices up the good news however is or crude cost have come down.
And gasoline prices -- started fall.
-- -- we're coming into the peak gas price time of year about a month -- month he will away so what's forecast look come down before it goes back up again.
No I'm not in the business forecast out of we've seen cuts in OPEC production and we've seen forecasts of record oil demand and that's why we have a tight market.
Let's talk about this sound goal US energy independence the timeframe is 20/20 four are you confident we're on track to reach that goal.
But we can be between what we can produce in this country between imports from Canada and biofuels we can become energy self sufficient from -- North American basis.
There are some hurdles though just look at the civil trial going on right now involving BP big bucks significant dangers with a deep oil deep water oil drilling.
Are you confident that the fracking industry won't run into some of the same risks.
Absolutely it's been done safely for sixty years there's new reason to believe that it won't there's a lot of misinformation out there and we simply need to get the facts.
Interesting.
Wal mart's.
World's largest retailer indicating weakness in their customer base we know we've got a situation -- gas prices are little higher than they should be right now and increased payroll taxes.
Were facing the sequestration of even -- -- Spending cuts to the federal government which could translate into significant job losses hundreds of thousands of jobs lost.
Is this gonna be too much for the lower and if you will consumer will we see any kind of demand destruction because of this climate.
Well there's no question of when gasoline prices go up consumers tend to cut back and other things the average household spends about 5% of its budget on gasoline about 4700 dollars.
And we've seen when prices increased they tend to substitute to -- cheaper products.
So we're looking at our own expectations for gas prices you mention of global picture we know that Saudi Arabia believe you mention this.
Or my notes.
Cutting production as well the cost of crude all of these factors like where should a -- look to determine what to expect in terms of what it's gonna cost -- -- -- tank.
Well the main thing is to take a look at what crude prices are doing -- there -- significant determinant of and then of course ethanol through.
And you just need to -- divide the barrel of crude by 42 and you'll see how much it is per gallon.
-- on fifty cents in taxes we have a pretty good indication of where things are going.
Were looking at economic forecast for the next couple of years that around 2% or so it.
There's always the question of what's driving growth frightened than usual suspects -- -- that -- government spending we know unemployment is still depressed the gas prices right what people are spending to fill up their tank.
And to heat their homes that's also a driver of growth and that's concerning to right.
Well there's no question but the real point is that we have a way out of that.
We can produce a lot more oil and gas in this country in that would stimulate growth jobs and energy security and that's really what we need to focus on.
Alright John Kelly thanks to cover a lot of territory a lot of questions from all different -- -- get to.
