T Boone Pickens tells Cramer: $100 oil will return

CNBC ^ | 12/3/2014 | Abigail Stevenson

[thackney]

With the recent collapse of oil, Jim Cramer has turned to a real expert on the subject to get a better sense on where the oil patch is headed during this crucial time.

That is why he has turned to oil tycoon T. Boone Pickens, best known as an American business magnate and financier who chairs BP Capital Management. Cramer thinks this Oklahoma native understands the oil business better than anyone else and could shed light on the importance of OPEC and impact of Russia on the energy space.

"They didn't say they wouldn't cut, but OPEC will have to cut and that is what's going to happen. The Saudis are the ones that make the cut. They can take $70 oil and take it out 10 years they have the cash reserves that allow them to do that. But they can't do that to the rest of OPEC," added Boone.

Pickens said that the industry assumed that the demand for oil would increase in 2014, and the actual demand was half. He noted that he expects that oil will be back at $100 a barrel in 12 to 18 months.

[Sequoyah101]

Lots and lots of tail production. Some of us predicted that because of the short life cycles of wells owing to poorer quality prospects and higher quality completions that deplete the wells faster and of course shale... that the cycles would be of higher frequency and amplitude. Add to the physical factors mentioned the fiscal factors of trading and oil becoming firmly entrenched as a commodity with the expectation that 1% over supply is a glut and the same 1% shortage is a disaster and this high frequency high amplitude pricing is what you get.

Oil as a commodity isn’t like crops that just have one set of output variables each year..... oil can change constantly and does. It has no real season.

[thackney]

San Antonio - Today
2 station at $1.99

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