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Citi’s Morse Sees $90 Ceiling for Brent

Monday, 11 Feb 2013 | 5:51 PM ET
Citi's Morse Sees $90 Ceiling for Brent
Refiners could continue to see growth even as the price of Brent crude develops a ceiling of $90 per barrel, Citigroup Head of Commodities Research Ed Morse says.

Refiners could continue to see growth even as the price of Brent crude develops a ceiling of $90 per barrel, Citigroup Head of Commodities Research Ed Morse said Monday.

A "price trigger" in crude oil led companies to pour money into new technology over the past decade, he said. "And here were are growing our production base by over a million barrels a day per year, and there's no real end in sight."

On "Fast Money," Morse said that new drilling technology would help lead prices lower.

"We think that the trading range of Brent, which has been $90 to $120 solidly for the last two years, is going to see that $90 floor become the $90 ceiling by the end of the decade," he said.

Morse said that refinery companies would win.

"There's no doubt the refiners will continue to benefit because we're still essentially a landlocked country," he said, adding that the market would see "crude oil priced under world market levels for as far into the future as I care to think."

Service companies, Morse added, was "a phenomenon that is going to explode across the planet by the end of this decade, and companies that know how to do this drilling are the companies that are going to benefit from the spread of this U.S. revolution to the rest of the world."

Trader disclosure: On Feb. 11, 2013, the following stocks and commodities mentioned or intended to be mentioned on CNBC's "Fast Money" were owned by the "Fast Money" traders: Guy Adami is long C; Guy Adami is long GS; Guy Adami is long INTC; Guy Adami is long MSFT; Guy Adami is long NUE; Guy Adami is long BTU; Guy Adami is long AGU; Steve Grasso is funds long CUBA; Steve Grasso is funds long GERN; Steve Grasso is funds long HPQ; Steve Grasso is funds long HSPO; Steve Grasso is funds long MU; Steve Grasso is funds long NEM; Steve Grasso is funds long NYX; Steve Grasso is funds long XRX; Steve Grasso is funds long ZNGA ; Steve Grasso is funds long ADT; Steve Grasso is funds long NUE; Steve Grasso is long AAPL; Steve Grasso is long ASTM; Steve Grasso is long BA; Steve Grasso is long GOOG; Steve Grasso is long GDX; Steve Grasso is long LF; Steve Grasso is long LNG; Steve Grasso is long MHY; Steve Grasso is long P; Steve Grasso is long PXD; Steve Grasso is long NVIV; Steve Grasso is long PFE; Steve Grasso is long S; Tim Seymour is long AAPL; Tim Seymour is long BAC; Tim Seymour is long INTC; Tim Seymour is long SBUX; Tim Seymour is long MCD; Pete Najarian is long AAPL; Pete Najarian is long BAC CALLS; Pete Najarian is long JPM CALLS; Pete Najarian is long MS CALLS; Pete Najarian is long YHOO CALLS; Pete Najarian is long BBRY ; Pete Najarian is long BBRY CALLS; Pete Najarian is long SBUX; Pete Najarian is long FB; Pete Najarian is long DELL.

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BRENT
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C
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