T. Boone Pickens' Crystal Ball...Predicting Oil Prices

Something is up with oil prices and T. Boone Pickens was discussing this on the Fox Business Network with Liz Claman. It is interesting to me that this important subject has not gotten more exposure on business television networks since consumers and companies dependent on gasoline have been concerned by the upward trend. Fortunately, Fox chimed in with one of the industry's leading authorities.

Today, oil closed slightly down at $58 a barrel, but that is not the direction one can expect it to go in the future, according to Pickens. In fact, he believes it will go to "$70 before $50” and that oil will be at “$75 a barrel by the end of the year.”

Concerning the continued stressful situation in both the United States and around the world, Pickens had a great deal to say:

• Concerning the Middle East, Pickens stated that "If Saudi Arabia falls, you will have $200 to $300 overnight. It’s razor thin where you are. When half our oil comes from unfriendly countries, anything goes off track, that’s where you are.”


• On Believing the Obama Administration Will End US Dependence on Foreign Oil, the tycoon showed incredible optimism: “Absolutely...This administration is going to have renewables, no question about it. They are going to reduce dependency on foreign oil. I have had meetings with Speaker Pelosi, [Senate] Majority Leader Reid, and they understand the problem and will get it corrected.”

Other highlights of the Claman and Pickens discussion:

• Pickens expressed concern about the huge number of oil imports, stating "This is more than half the trade deficit [and] has far-reaching tentacles and influence over what goes on in this country, where it has not been exposed or even explained to anybody,"


• Regarding obtaining oil from countries that are potentially hostile (such as Venezuela, Nigeria, and nations in the Middle East): "This is absolutely insane, that this country is dependent on supplies as precarious as Nigeria for instance or Venezuela," said Pickens. "Look at Saudi Arabia: They produce 9 million barrels a day. What we import is greater than what Saudi Arabia produces."


• In sum, the long term predictions are very dire indeed, with Pickens noting "I promise you this is going to get tight, very, very quick," said Pickens. "You're going to be back to $75 oil by the end of the year -- and $200 per barrel within five years."

The 80-year-old oil baron turned alternative energy guru provided interesting insights on an issue that is crucial for consumers and business owners in their decision making. Fortunately, Fox Business Network provided this interview. However, I want to remind the reader that his commentary is colored by his significant investment on alternative fuels. His predictions almost certainly must come true for his investments to pay off accordingly.

In July 2008, Pickens announced his ambitious Pickens Plan which focuses on alternatives such as natural gas, wind, and solar energy. His multi-media efforts to get the US government behind these alternatives are predicted to cost $58 million. This doesn't include the considerable investment that is going to be necessary to create the economy of scale required to make the goal of energy independence possible.

Kevin Price is Host of the Price of Business, the longest running show on AM 650 (M-F at 11 am) in Houston, Texas and on AOL Radio. Eric Bolling of Fox News and Fox Business says that Price’s Blog “is very influential and moves the blogosphere.” Steve Moore of the Wall Street Journal calls Price the “best business talk show host in the country.” Find out why and visit his blog at www.BizPlusBlog.com and his show site at www.PriceofBusiness.com. You can also find Price on Strategy Room at FoxNews.com.