Skip navigation
Oil Video Gallery
CNBC's Bertha Coombs discusses the day's activity in the commodities markets, and looks ahead to where oil is likely hea...
Discussing a potential "trader tax," with Rep. Peter DeFazio, D-Oregon and CNBC's Erin Burnett.
A check on oil, gold and the dollar with Stephen Schork, of the Schork Report; Philip Gotthelf, of Equidex; and Robert B...
Watchlist Sponsored By :


Current DateTime: 08:08:47 08 Nov 2009
LinksList Documentid: 24355697

Current DateTime: 08:08:47 08 Nov 2009
LinksList Documentid: 24890560
  • Winterizing Your Portfolio

      If 2009 was the winter of our discontent, will 2010 be a winter wonderland for investors? A lot depends on the recovery—or lack thereof.

  • Investor's Guide to Real Estate

      Some even say the long-awaited recovery is here. Regardless, buyers and sellers alike can profit from our guide.

  • Alternative Investing

      Stocks and bonds? Sure. But it's a big world out there for investors.

powered by digg
Pickens Expects Oil, Natural Gas Prices to Fall
By: Andrew Fisher | 22 Feb 2008 | 02:37 PM ET
Text Size

After correctly predicting oil's climb to more than $100 a barrel, legendary oilman Boone Pickens said Thursday he is shorting both the oil and natural gas markets in the belief that oil will stage a short-term pullback.

Boone Pickens
Richard Drew / AP
Boone Pickens

"I think oil's going to back off," he said, during an interview on "Squawk Box." 

"The weakest quarter is the second quarter.  We'll drop $10 or $15 a barrel in the second quarter.  I think we'll be back above $100 in the second half of the year."

"I think natural gas prices are unusually high now, and I think they're going to back off, also," he added.

When investors take a short position in an investment they are betting the value of the investment, be it a stock or a commodity, will fall. Short-sellers often borrow securities, then sell them, waiting for their value to fall so they can buy the asset at a lower price, return them to lender and pocket the difference in the prices.

In a wide-ranging interview, Pickens also declared some support for alternative energy, saying half a trillion dollars a year is going out of the country to buy oil.

"We've got to get coal cleaned up, and we've got to get natural gas into the transportation mix. We're transferring so much wealth out of our country," he said.

According to Pickens, solar power technology is "almost there," and there could be "corridors" of wind power developed from Texas through the Great Plains and west to California.

A company Pickens founded, Clean Energy Fuels Corporation, provides natural gas to power buses, taxicabs, government vehicles and trucks.

He also revealed a change of heart on ethanol.

"I was a hard guy on ethanol," he admitted.  "I didn't jump for that at first, but I'd rather have ethanol, and recirculate the money in the country, than to have it go out the back door on us."

Despite his move into alternative energy, he remains a major player in oil.  In a Securities and Exchange filing last week, he revealed he holds a 9.5 percent stake in Interoil [IOC  Loading...      ()   ].

The discussion also touched on Pickens' early support of the unsuccessful presidential bid of former New York mayor Rudolph Giuliani.

"My guy rode up in front of the grandstand and fell off his horse," he said.

According to Pickens, the presidential candidates are clueless about what to do about an energy crisis.

"These candidates have to get up to speed on what energy costs is doing to our country," Pickens said.

Pickens, who founded and chairs the $4 billion BP Capital Management hedge fund, had previously told CNBC that he expected oil prices to reach $100 based on growing global demand.

U.S. oil prices peaked at $101.32 per barrel on Wednesday, surpassing the highs near $100 hit early in January, on expectations that OPEC will maintain or even cut its supplies when ministers meet on March 5. However, after a bigger-than-expected drop in crude oil stocks in the U.S., the price of U.S. light, sweet crude retreated to below the $100-mark.

© 2009 CNBC.com
Tools:
Print EmailAdd This share icon
  • digg share

CNBC HIGHLIGHTS

  • Rumors abound that Oprah will leave her show to start a new network. What would this mean for daytime TV?
  • David Moore
  • A private equity specialist sponsored a stand-up comedy troupe in New York to prove that CEOs can, in fact, be funny.
  • Jim Cramer
  • Cramer did the research and found eight stocks that lead the pack. Read on to get his top picks.
  • Hideki Matsui
  • Did Hideki Matsui’s performance make it more likely that the Yankees will pay to have him back?
  • Which wines should you bring—or serve—with holiday meals this year? Ask a connoisseur.
  • Two competitors in this year’s World Series of Poker in Las Vegas have stories fit for Hollywood.
ADD COMMENTS
Remaining characters


Current DateTime: 01:48:33 08 Nov 2009
LinksList Documentid: 29778428

Current DateTime: 01:48:33 08 Nov 2009
LinksList Documentid: 29779196

Current DateTime: 01:48:34 08 Nov 2009
LinksList Documentid: 29779199

Current DateTime: 01:48:36 08 Nov 2009
LinksList Documentid: 29779198
  Data is a real-time snapshot  *Data is delayed at least 15 minutes
Global Business and Financial News, Stock Quotes, and Market Data and Analysis

© 2009 CNBC, Inc.  All Rights Reserved.
A Division of NBC Universal
Thomson ReutersThomson Reuters