I was on CNBC this morning talking about oil prices and where I thought they might be going. After the House of Representatives failed to pass that bail-out bill yesterday, oil dropped $10 per barrel, but that’s not the way you can look at these things. I said that in a year oil would be back up to $150 a barrel.
I explained it this way: The world is producing 85 million barrels of oil per day. It’s been projected that the total amount of oil that the world is USING is 86-87 million barrels of oil per day.
I told them, “If you’ve got 87 million barrels being used and 85 million barrels to cover it, the only way you take care of demand is by price.”
They asked me about the fundamentals of the economy, but I told them I was an expert in oil and gas; but I’m not an economist so they’d have to ask someone else who is an expert on the economy.
I do like the fact that Treasury Secretary Hank Paulson is talking to Warren Buffet so we’ve got a really smart guy working on this thing which is what you need to have.
We’ll see how this whole thing shakes out through the rest of the week, but it doesn’t take away from what you and I are concentrating on: Getting us off that foreign oil, so we don’t have to worry whether oil is $95 per barrel or $295 a barrel.
— Boone
