Energy entrepreneur T. Boone Pickens predicted Tuesday that Brent crude oil will be at $90 to $100 barrel in 12 to 18 months. "The world got along fine with $100 oil," he said on CNBC.
Less global demand for oil is more to blame for the price drop than oversupply, Pickens said in a "Squawk Box" interview.
"The demand for the world was another 1.3 million this year, and half of that is what we got," he continued. "The oversupply for oil has come from the United States."
The Organization of the Petroleum Exporting Countries alone can't satisfy the world's need for oil, he added. "Are they trying to test the U.S. producer? I don't know, maybe so."
In a heated exchange over "peak oil," defined as the point when extraction rates top out, Pickens defended his 2005 call, which came before the U.S. shale boom. "We did peak [for OPEC] in 2005."
"If you look at 2005, you're finished as far as for the rest of the world. What saved you was the shale. American industry saved the world one more time," he said.
He rejected assertions that he was wrong in 2005 about "peak oil" given the landscape of today's oil market.
"That's all good bulls--- and all," he said—implying that at the time there was no way to know how big the shale boom was going to be. "I'm the expert you guys, not you."
With more than a half century in the oil and gas business, Pickens spent most of his career building Mesa Petroleum into a powerhouse. After selling Mesa in 1996, he founded BP Capital Management, an investment firm focusing on the energy industry.
If U.S. production were taken out of the mix, oil prices would be around $150 to $170 a barrel, Pickens estimated during Tuesday's interview, a day after OPEC talked down the oil market.
Crude prices were stable in early trading Tuesday. Brent was around $61 a barrel—near 5½-year lows and down more than 50 percent from its peak of $112 a barrel in early January.
Pickens said OPEC is no longer a cartel but is now a "trade association" controlled by Saudi Arabia. "The world needs the U.S. addition to oil production," he said.
He expects a quick drop in U.S. production in hopes of bending the supply-demand curve. "Just watch the rig count. You have 1,500 rigs running on oil. Already you have dropped 75 rigs in the last three weeks."
His advice to drillers: "Go ahead and accept it."
Continental Resources, run by billionaire Harold Hamm, has said it is decreasing its capital budget from earlier projections to $4.6 billion. The oil and nat gas producer also plans drilling rig cuts.