Oil prices could top $300 per barrel within the next five years, according to one industry expert.
Matthew Simmons, chairman and founder of specialised energy investment banking firm, Simmons & Company International, said the current highs of $100 per barrel are "cheap".
"I think the supply is showing some very troubling signs that we might well have already peaked and started [to slow] down. If we haven't, we are very close to it," he told Arabian Business. "Demand on the other hand shows absolutely no sign of slowing down because we are now at $100 a barrel, which I still think is a preposterously cheap price. It works out at just $0.15 a cup.
"A cup of gas will get a car with six passengers in, with the air conditioning on and go two miles. It's a bargain," he added.
Simmons also told Arabian Business he is more concerned about energy shortages than the rising price of oil. "What I am worried about most is not high prices but shortages because then people worry."
He noted that in the UK's capital, London, where typically the price per gallon can reach as much as $9, it hasn't deterred motorists from continuing to use their cars.
"[That price] doesn't seem to have slowed anyone down. It works out as much as $378 a barrel. Yes [I can see it reaching that high]," he said.
"We'll never run out. What we will run out of is light sweet oil because it is the easiest to get out of the ground. So all we will be left with are massive amounts of oil in places but it is going to tend to be stains on rocks or oil sands," he continued.
Simmons is a leading expert in his field and author of the controversial book, Twilight in the Desert: The Coming Saudi Oil Shock and the World Economy. In the book Simmons argued that Saudi Arabia will, in the coming decades, be unable to maintain its current level of oil production, with huge economic repercussions. Simmons said that the peak oil issue is poorly understood and the world's data on production, demand and inventories is inaccurate.
Last week oil reached a new record of $102, closing in on its inflation-adjusted peak, as a slumping dollar on lacklustre US economic data triggered a surge across commodities markets. Opec's president said members would agree not to raise production in part because of fears of a demand slowdown.