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Page added on June 27, 2015

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T. Boone Pickens: $70 Oil Coming

During an appearance on FOX Business Network’s Mornings with Maria, T. Boone Pickens, BP Capital Management Chairman said we should take advantage of America’s energy, as it is the cheapest in the world. And he warned that U.S. consumers are becoming too complacent with cheap gasoline prices because he believes oil will rebound to the $70 per barrel level by the end of the year.

“None of those things are ever mentioned by anybody because they have two dollar and fifty cent gasoline, well that isn’t going to remain forever. But here you need to look at energy as a powerful, powerful asset America has and it just has to drift along, nobody says anything.”

Along with oil, Pickens said America should be taking advantage of cheap natural gas prices.

“All right, what is it: You’re 75% cheaper than the rest of the world in natural gas, you’re 10% cheaper on oil and you’re half the price of gasoline versus the rest of the world, take advantage of it. Understand how to use it and use it to our advantage.”

Regarding the 2016 race for the White House, Pickens noted that he had attended an event for Jeb Bush last evening and he said that he would be supporting him, as he has always supported the Bushes.

“We’ve got some good candidates, whoever we get on the Republican side, we are going to beat Hillary,” notes Pickens.

A recent Fox News Poll of primary voters released this week shows Hillary Clinton leading the Democratic Nominees with a 61% margin. While Jeb Bush is the leading Republican candidate with 15%.

Fox News



21 Comments on "T. Boone Pickens: $70 Oil Coming"

  1. joe on Sat, 27th Jun 2015 10:21 am 

    $70 $80 it’s not important, other than at what point we see the Saudis groaning in their economic war with tough oil. I just don’t see it. Roughly, Saudi might spend a few billion on its annual budget plus cost of sales equals how much oil they have to sell to maintain the war. It’s not as much as people think. Also let’s not forget that geopolitical risk us not being priced in enough, that is a tell right there. All Saudi have to do is manage risk for investors in tough oil, right now investors won’t go in even at 70, because they risk a downturn if Iran gets a deal and iraq ramps up. They could get burned again. If I had a spare billion I would not be buying into start ups in tough oil for another year at least because you won’t see that money for another few years by which time you can’t be sure of the price, but it’s not going to be too much more, and even if it’s 90 or 100, after profit, tax, cost of sales when you get your cut you might see 2-5% at the most.
    Gas is going to be better, but it’s so abundant it’s likely to peak demand too, as global growth is slow. Tough oil is not as easy to turn on and off. It’s likely that Saudi know their stuff enough not to panic at oil price changes. The US on the other just has to mess up its political front a bit more and civil war in Iraq, Arabia, and Africa could ensure enough of a price hike to encourage people to invest big in tough oil.

  2. Amvet on Sat, 27th Jun 2015 2:57 pm 

    The so-called global oil glut, in my opinion, did not and does not exist. The majority of global oil is used outside of the developed countries. The media looks at the USA and thinks it represents the globe. Even inside the USA the storage “glut” was 60% due to a sudden, unexplained, surge in imports. Contrived?

    Accidental?

  3. roman on Sat, 27th Jun 2015 4:10 pm 

    $70?!!! Holy shit. I just shit myself.

  4. john k butler on Sat, 27th Jun 2015 4:16 pm 

    Complacent??? WOW! You gotta be kidding me!

    PICKENS – Americans have been raped, robbed, pillaged, and gouged by big oil for DECADES,,, and yet now,,, now that prices have FINALLY COME DOWN you’re telling us the American public has become too complacent with cheap oil and therefore prices should go up to counter it and keep the masses in their place???? WOW!!!

    You know Pickens – we all know you’re heavily invested in oil and the higher the price the more money you make, but to take the position you have is beyond the pale! It’s outrageous! Hasn’t it ever occurred to you that lower prices might be beneficial to the millions around the country who lost their jobs, their homes, their wealth, their dignity, their hopes, AND their dreams to the greed of self-righteous, self-serving, arrogant elite Wall Street bankers who ripped the nation off to the tune of trillions and left the country,,, AND the economy in ruin,,, or hasn’t that thought ever entered your mind? Millions lost everything,,, and they’re still struggling,,, yet you say what you do???? WOW!!!

    Pickens – it can’t always be about the buck! Sometimes it has to be about something more intrinsic – like the people (you know – the ones who labor, work, toil, and sweat to make life as we know it possible)! Without them – you’d have nothing!

    Think about that!

    And think about this: WHEN’S ENOUGH ENOUGH???

    PICKENS – WHEN’S THE GREED STOP???

  5. dissident on Sat, 27th Jun 2015 4:43 pm 

    As noted by ROCKMAN in another thread, the spread between supply and demand today is the same as it was when the oil price was at an all time high. The real reason for low oil prices is weak economic activity and not any sort of glut.

  6. BobInget on Sat, 27th Jun 2015 4:50 pm 

    Picky, picky, T. Boon is into natural gas these
    days.

  7. shortonoil on Sat, 27th Jun 2015 8:23 pm 

    $70 is possible, although not likely, in 2015. It is not going happen in 2016:

    http://www.thehillsgroup.org/depletion2_022.htm

    The average barrel of oil delivers 77,800 BTU less per year. That is how much more energy it takes to produce it, and its products each year. T. Boone is still a believer in the magic of oil. He thinks its a substance delivered by some divine power, and that it has unlimited potential. The price of oil is not going to increase enough to save the oil age. Its days are numbered!

    http://www.thehillsgroup.org/

  8. Charles on Sun, 28th Jun 2015 5:58 am 

    With the rail stocks trading near their yearly lows now’s the time to begin building a position. RAIL-GBX-TRN & ARII are screaming buys…..IMO

  9. Boat on Sun, 28th Jun 2015 7:33 am 

    dissident……The real reason for low oil prices is weak economic activity and not any sort of glut.

    Ahem. So demand is growing slowly. Then oil produced to much. Conclusion: there is no glut

    I worry about you dissident

  10. Boat on Sun, 28th Jun 2015 7:37 am 

    T Boone, T Boone ….“All right, what is it: You’re 75% cheaper than the rest of the world in natural gas, you’re 10% cheaper on oil and you’re half the price of gasoline versus the rest of the world, take advantage of it. Understand how to use it and use it to our advantage.”

    When does your book come out with the new and improved ways to use FF. I want to achieve the optimum from every drop. Wonder if his idea is conservation. HHmmmmm

  11. keith on Sun, 28th Jun 2015 9:47 am 

    Notice all the new dollar stores opening everywhere. That is evidence of how the economy is doing. Evidence is in plain view to all see, but we’ve become a society of doubters needing an authority figure to explain things before we believe what we are seeing. If the authority figure never speaks, all is well. The average person is detached from reality. I guess living in this 100 year mirage will do that. Behavioral control of the masses is the last card in the deck for the authority. Unfettered population growth grows an economy, if the economy is not growing and will not grow, then look for population control measures to happen. How? I don’t know. But look for this happen.

  12. BobInget on Sun, 28th Jun 2015 9:50 am 

    Published: Jun 26, 2015

    by Grant Smith

    June 26, 2015

    Oil will reach as high as $100 in the second half of next year as demand strengthens and supply falls short of forecasts, according to a fund manager who’s worked in the industry for more than three decades.

    Demand will exceed supply by about 1 million barrels a day by the end of this year and a shortfall will persist into 2016, Charles Whall, who manages about $1 billion of assets in energy equity funds at Investec Asset Management in London, said by phone Wednesday. Oil probably will reach a range of $90 to $100 in the second half of next year, he said.

    Saudi Arabia, the biggest oil exporter, is leading OPEC in a strategy of defending market share rather than prices and is pumping the most crude in about three decades. While Citigroup Inc. and Goldman Sachs Group Inc. say the nation will keep raising output, Whall says the limit may already have been hit.

    “The general picture could be quite wrong,” said Whall, whose funds have an “overweight” position on exploration and production companies, particularly in North America. “This looks like a much tighter market next year than people are anticipating.”

    Brent crude, a global benchmark, rallied 40 percent to $63 a barrel since reaching a six-year low on Jan. 13. Prices could reach $80 by the end of the year, Whall said. They will average $85 next year, according to Investec’s base case.
    Output Peak

    Saudi Arabia has been supplanted by Russia as the top supplier to China and that indicates the nation is already at its sustainable output peak, according to Whall.

    “They’ve got a battle for market share at the moment,” Whall said of Saudi Arabia. “The Russians are now selling more crude than they’ve ever done to the Chinese. So if they could produce more, of course they would.”

    Saudi Oil Minister Ali Al-Naimi said June 18 that output can rise to meet demand and that his nation retains spare daily production capacity of as much as 2 million barrels.

    Traders also should be more conservative in their assumptions about how much extra supply will come from Iran, Whall said. The nation’s output was declining before sanctions were imposed, he said.

    Iranian Oil Minister Bijan Namdar Zanganeh said June 5 that his country could increase production by 1 million barrels a day within about six months of a deal to lift sanctions. It might actually add only 400,000 barrels a day next year in the event of a deal with world powers over its nuclear program, Whall said.

    Falling oil prices have also cut spending across the industry and that will curb future production plans, Whall said. Even if prices rise and U.S. drillers activate more rigs as a consequence, it will take time for that to translate into higher output, he said.

  13. Apneaman on Sun, 28th Jun 2015 10:06 am 

    So an energy fund manager is basically telling his investors that prices are going up so everything is going to be awesome…. trust me…now about my bonus.

  14. BobInget on Sun, 28th Jun 2015 10:11 am 

    IMO, crude is going higher in a matter of weeks not months as the Mideast, North Africa boils over this Summer.

    Markets simply can’t admit The Islamic State even exists much less a genuine threat to Western Oil supplies.

    So many people have been killed in so called terrorist attacks we’ve become accustomed.

    One single home grown terrorist kills church goers in cold blood and we look inward for cause. Ask yourselves, what if that terrorist was Islamic? Would that attack have more relevance
    or less?

    When suicide bombers attack a Mosque, during ‘holy month’ no less, we hardly notice. I assure you, ‘they’ notice.

    ‘They’ all have names, lovers, children. They know why we invaded Iraq. Now, we are just beginning to know ‘they’ know.

  15. Davy on Sun, 28th Jun 2015 10:47 am 

    Bob, I can just as easily say “Bob, crude is going lower because of a Chinese stock market bubble bursting and a Grexit.”

  16. Nony on Sun, 28th Jun 2015 11:02 am 

    Market predicts a wash

  17. BobInget on Sun, 28th Jun 2015 11:33 am 

    China, always China, never India, when will we learn?
    Russia has grabbed the bulk of Chinese crude imports. Soft landing, hard landing, China and India by 2020 can absorb every exportable barrel
    worldwide.What I’m saying, nothing for Japan, Korea, Vietnam, the USA. Nada. China and Russia are playing a long game while the US plays tough guy using borrowed Saudi funding.

    Grexit should be meaningless. I know, i know, there will be a few days of market turbulence.

    The Greeks get nothing from a bailout. Every penny goes to make debt payments. It’s like using one credit card to make payments on another. Current Greek economy is on pare with Oregon, my home.
    If Oregon were in BK danger, few would notice.
    https://en.wikipedia.org/wiki/Comparison_between_U.S._states_and_countries_by_GDP_(nominal)
    Unlike Oregon Greece get to print their own revalued currency.
    When Greece defaults, it’s hotels, restaurants, bars even historical beach chairs will fill with German bargain trippers. By summer’s end Greece will be rolling in tourist hard currency.

    (oil consumption will go up, as if it matters)

  18. Boat on Sun, 28th Jun 2015 12:49 pm 

    Iraq has oil to sell, Iran has oil to sell, Nigeria has oil to sell and the frackers are waiting for the price to sell. I personally don’t see oil spiking to $100 unless the wars and rumors of wars gets a lot worse.

  19. BOB on Sun, 28th Jun 2015 2:51 pm 

    That ol’ geep and the rest of the Billionaires Club has been saying 30 dollar oil then 80 dollar oil for 6 months. All the their doing is manipulating those fools stupid enough to play their rigged game.

  20. william on Sun, 28th Jun 2015 10:40 pm 

    $70.00 may becoming but $ 20.00 is next

  21. GregT on Sun, 28th Jun 2015 11:16 pm 

    70 may be coming, 20 may be coming, and 100 may be coming. It doesn’t really matter. Oil is a finite resource, and burning the shit is destroying our planet.

    Just like a bunch of heroin junkies, we’re trying to figure out where our next fix will come from, and how much it will cost. In the meantime, we’re killing ourselves, our planet, and all of the other lifeforms that share our planet with us.

    I’ve come to the conclusion that my species is completely fucked.

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