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Page added on June 7, 2010
Boone Pickens: Get Ready for $400 Oil
If we don’t do anything,” Pickens said, “in 10 years we will be paying $300 or $400 a barrel for the oil.”
The US is already paying $1 billion a day for crude, he said, and it accounts for two-thirds of the country’s trade deficit. That doesn’t need to happen, though. If the US used its own resources, Pickens thinks the move would lead to job creation, and those dollars would stay at home.
That’s why he’s so bullish on natural gas, a fuel that’s plentiful here in the US. So much so that Cramer called Pickens “one of the biggest boosters of natural gas out there.” But he endorses more than just that one commodity. As part of the Pickens Plan he announced back in 2008, he called for the utilization of all kinds of energy – wind, electric, even ethanol – as long as it was American.
“Anything but OPEC oil,” Pickens told Cramer. “That’s what I don’t want.”
But, of course, today’s discussion was largely about nat gas, as President Obama this week put the full weight of his office behind the commodity during a speech at Carnegie Mellon in Pittsburgh. Pickens took the statement to mean President Obama finally understands that nat gas is the US’s only viable competitor to diesel fuel, that nat gas is both cleaner and cheaper than crude and coal.
“And it’s ours,” Pickens said. “We’ve got to use it.”
To that end, he fully expects the NAT GAS Act presently in Congress to pass. He said Senate Democratic Majority Leader Harry Reid, of Nevada, told him he wanted an energy bill this year, Pickens said, “And that’s going to happen.”
If so, it’s about time. As Cramer pointed out, the major oil and gas companies – especially foreign firms – already have recognized natural gas’ importance, and they are buying up both smaller players and assets here in the States. Royal Dutch Shell joined in on the action just this week, paying $4 billion for a chunk of the Marcellus Shale.
But Pickens sees that as a good thing.
“The majors are moving back into the United States,” he said. “I want them back. I want them spending money here. They will figure out a way to get more recovery out of the shale gas.”
3 Comments on "Boone Pickens: Get Ready for $400 Oil"
James on Mon, 7th Jun 2010 11:31 am
Last I heard, natural gas was also in decline. So, why is Mr. Pickens pushing it? Could it be that he owns a lot of lands that may, or may not have gas? Natural gas wells start giving gas quickly and give out quickly as well. There is no way to predict accurately, how much Natural gas the U.S. actually has. Also, why were we talking about importing Natural Gas in compressed form on ships from other countries if the U.S. has so much gas? Something ain’t right here.
ian807 on Mon, 7th Jun 2010 11:11 pm
That prediction isn’t a tough one to make. Neither are admonitions to develop alternative energy sources. I don’t hear much new or even particularly interesting here.
KenZ300 on Tue, 8th Jun 2010 12:30 am
Anything but OIL. We need to stop sending money to counties that want to do us harm. Our economic security and our national security demand that we move to alternative fuels now.
If PEAK OIL theory is correct and demand exceeds supply of oil in the next few years the price of oil will increase.
China and India are using more and more oil each day driving up the price for all.
The last time gas got to $4.00 a gallon people were parking their pickup trucks and SUV’s and were looking for high mileage vehicles. The American family and the American economy will have a tough time with ever increasing OIL prices. We need to transition to alternative energy now. The sooner the better. We can not afford to wait.
Those hour long commutes from the suburbs will get very expensive with $5.00 a gallon gasoline.