There were reports last week, since clarified, that a cargo ship was seized by Iran, but every day there seems to be a headline dealing with Iran. How does that affect Boone’s outlook?

Iran is “operating like a real country.” They claimed that after sanctions are lifted they could produce an additional million barrels of oil a day. “I don’t think they have the capability of doing that,” Boone said. “I think it’s closer to 200,000 additional barrels a day.” But overall, Boone said “you’re dealing with people who won’t tell the truth.” He said Secretary of State John Kerry is trying to make a deal with the Iranians “that no one wants.”

We don’t have to deal with OPEC or Iran (which is not a member of OPEC) because “the United States has plenty of resources and we do not need Mid-East oil.” Boone said he doesn’t think the President or John Kerry understand that because “they don’t understand the oil market; they don’t understand the oil business; and, what they do understand, they don’t like.”

Why is Boone predicting $70 oil by the end of 2015 and $90-100 oil by the end of 2016?

He said we had 1,509 oil rigs operating in the United States at the end of 2014. We now have 702. As rigs are taken out of production, supply drops. In addition, “wells drilled in the shale with a horizontal hole and multiple frack jobs decline very rapidly. The Bakken has rolled over [is declining in output], as has the Eagleford” shale play in South Texas, and the Permian Basin in West Texas isn’t far behind.

Last week, we drew from the U.S. oil depository hub in Cushing, Oklahoma, rather than filled, for the first time since oil prices dropped. That, he said, is an indication that supplies are falling and “and demand is very strong.” Supply coming down, demand going up “is perfect for increased prices.”

On the $70 billion acquisition by Royal Dutch Shell of British oil company BG Group earlier this month, Boone said Shell had announced that they couldn’t drill wells cheaply enough in West Texas, although a lot of companies are drilling and producing a lot of oil there. “I think Shell decided to play the ongoing industry by growing their reserves. BG was kind of a floundering company and Shell ‘picked them off.’” As prices rise, independents will be in better shape but “there will be some of these big independents that will be acquired by the Exxons, Shell, or Chevron.”

On alternative energy like wind and solar, Boone said “solar’s harder for me because nobody’s been able to show me where anybody’s made any money, yet.” He said he’d get back into wind energy. “I understand it, but I’d want $6 natural gas before I got back into wind.”

What keeps Boone going? He said he had three rigs that he shut down when oil prices dropped, “but when oil gets back up to $65, I’ll get back to drilling, and I have other places to drill.” He also said BP Capital operates five funds “and I have five teams made up of people I think are the best in the business running them.”

On long term investing versus quarter-by-quarter results and activist shareholders, Boone said that takes him back to the 1980 when Gulf Oil’s stock had never been over $35 dollars and “Gulf Oil was worth $85.” Today, there are men like Carl Icahn and Steve Cohen who “will jerk you around a little bit if they see value that you’re not getting for the shareholders.” Boone was asked recently about Icahn and said that back when Boone was active in that arena he was called a “corporate raider.” “Now,” he said, “Icahn is called an activist shareholder.” Boone went onto say that Icahn has made more money for shareholders than any CEO he could name, but when Boone described Icahn as “being as smooth as a stucco bathtub,” that drew a phone call from Icahn.