LEWISTON – If energy expert Glenn Davis could give the small business owner advice about reducing energy costs, it would be this: pay attention and conserve.

Davis, chief investment strategist for TD Banknorth’s Wealth Management Group, brought his understanding of energy markets to the chamber’s monthly breakfast meeting Thursday at the Ramada Inn.

Mideast conflicts, supply interruptions – like this week’s Prudhoe Bay pipeline shutdown – questionable reserves and China’s growing economy all play a role in how much oil there is and how likely it is to end up in American refineries. And U.S. consumption continues to rise, even though we use less energy per dollar of our Gross Domestic Product than 20 years ago.

“We’ve become more efficient, but we use more of it,” said Davis, mentioning the growth in the number of teens who have their own cars, bigger homes, energy-consuming toys like snowmobiles and boats, and our inclination to drive wherever we want to go.

Growing demand and tighter supplies have prompted price hikes, which can fluctuate wildly. But consumers feel the pinch; analysts expect every time the price of gas rises a penny, that’s $1.4 billion out of the pocket of consumers.

“Gas prices have to get well over $3 per gallon before people start using less rather than just thinking about using less,” said Davis.

On the upside, the stock market has responded positively to fluctuations in energy costs, and Davis expects that will continue. Earnings are still above 10 percent. Corporations have healthy balance sheets that reflect good cash balances, rather than heavy debt as was the case in the 1990s. And the rise of private equity funds prompts more merger and acquisition activity as those funds look for new investments.

“Stock markets are a good thing to use as a gauge for the rest of the economy, and our (national) psychology as well,” he said.

He encouraged people to continue to conserve energy in their everyday lives. If their businesses are oil-dependent, he advises trying to hedge by buying bulk when the prices are low. World events that threaten supply lines nearly always create a spike, but tend to moderate after a while. They also tend to dip after the high driving season and after the heating season. It pays for business owners to be aware.

“But gas and electric rates are more difficult for a small business” to anticipate,” he said.

For the immediate future, Davis is optimistic.

“If we get together again in a couple of years, I think things will work out reasonably well,” he said. “The stock market should be up and the economy should be OK.”