Remember when oil jumped on news Boone Pickens thought oil would reach $150 and the world was at peak oil? Well, he didn’t soften his stance one bit during testimony to the Senate Energy and Natural Resources Committee yesterday:
I do believe you have peaked out at 85 million barrels a day globally.
[The United States alone has been using] 21 million barrels of the 85 million and producing about 7 of the 21, so if I could take just a minute on this point, the demand is about 86.4 million barrels a day, and when the demand is greater than the supply, the price has to go up until it kills demand.
In the weeks since Boone made his $150 call, oil is up a bit. But Boone’s opinion is no longer startling. In fact:
- $150 is no longer a remarkable call, just the norm
- Peak oil is now the consenus
Which, in our opinion, is setting the table for the mother of all crashes. The only questions are “when?” and “how high will prices go in the meantime?”