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Legendary oil investor Boone Pickens stood by his forecast that oil prices will hover around $150 a barrel now and told CNBC that they may fall to about $100 in two years.
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AP Boone Pickens |
"I'll stick with $150 (per barrel)," Pickens, who is also CEO of BP Capital, told "Squawk Box". "Demand going down, that's what will bring this thing in better balance".
Asked where he saw the price of oil going in the next two years, he said: "You could get it back down to about 100."
The high oil prices are not determined by speculators and the weak dollar but by supply and demand, Pickens also said.
"It (the price of oil) isn't driven by speculation," Pickens said, adding that for 85 million barrels of oil production, demand is around 86 million barrels.
Also on Tuesday, JP Morgan [JPM
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] raised its oil price forecast to an average $127 a barrel for 2008 from its previous assumption of $105.
Pickens also said the U.S. should have a call -- an option to buy at a certain price -- on oil coming from Iraq.
"What's happened now is we've paid billions and billions of dollars for the Iraqi situation and we've lost 4,000 lives," Pickens said. "We should at least come out of there with a call on their oil at market price."
Cutting ImportsBuilding new wind generation facilities to reduce America's dependence on foreign oil is essential for the country's economy, he added, unveiling a plan to boost the use of alternative energy.
The U.S. is currently importing 70 percent of the oil it needs compared with 42 percent in 1990 and 24 percent in the 70s, and this is costing the country $700 billion, Pickens said.
"We are very close to a disaster for the country," he told "Squawk Box." Importing oil "is expensive now, it's gonna get more expensive," he added.
Asked whether drilling for oil should be allowed everywhere, Pickens answered "I say yeah, let's go ahead and do it."
The Department of Energy estimated that 20 percent of America's energy needs can be covered by wind energy, but Pickens, who already invested in the field, says it can cover as much as 40 or even 60 percent.
There is a "perfect spot" in the interior of the country, a corridor stretching from West Texas to the Canadian border, for wind turbines, said Pickens, who dubbed America "the Saudi Arabia of wind."
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