Oil tycoon T. Boone Pickens, who made and lost fortunes targeting some of the largest U.S. explorers in the last 4 decades, has cashed out because the worst crude market downturn in decades drags on.
Pickens who has sold all his oil holdings and is waiting for the best moment to get in, he said Thursday within an interview on “Bloomberg Go.” With prices low, mid-size U.S. oil companies such as Pioneer Natural Resources Co., Anadarko Petroleum Corp. and Apache Corp. are acquisition targets for bigger firms like Exxon Mobil Corp., he explained.
I will not re-enter until starting to attract on inventories. That’s a key point
Crude prices have slumped 70 percent since June 2014, leading the oil industry to eliminate a lot more than 250,000 jobs and slash over US$100 billion in spending within the last year, with more cuts expected this season. The reductions should lead to a drop in oil production, which would boost oil prices back to the US$50-$60 range after the year so long as the economy doesn’t enter an economic downturn, Pickens said.
Related
- Shell posts its worst performance on oil reserves since 2004 scandalSuncor Energy Inc to cut spending by 10% after surprise $2-billion lossIs it time for you to buy energy stocks? Two assumes this burning investing question
-
-
-
“The low is within,” he said. “Just do not get in a rush here. You are going to have plenty of opportunity. The market is going to be volatile. it will not go upright, so there will be good entry points.”
West Texas Intermediate has rebounded 22 percent since touching a 12-year low of US$26.19 a barrel on Jan. 20.
Pickens started reversing course within the third quarter by shedding pounds his energy holdings and selling several stocks he’d bought just 3 months earlier, according to data compiled by Bloomberg.
Pickens won’t start investing again until crude inventories start to fall. Within the U.S., commercial stockpiles have risen in 16 of the past 19 weeks and now stand at a lot more than 500 million barrels for the first time since 1930, at the height of the East Texas oil boom.
“I won’t re-enter, I’m sure, until starting to attract on inventories,” Pickens said. “That’s a key point.”
Bloomberg.com
