Dallas Morning News: Pickens says prices headed lower.
One of the oil market's most prominent bulls, Boone Pickens, has turned bearish – at least for the coming months.
Mr. Pickens said Wednesday that oil is headed toward $50 a barrel and natural gas may have hit its peak even before the winter arrives.
A weaker economy and mild weather so far this fall could translate into falling demand. Though Mr. Pickens doesn't expect a recession in 2006, "it's not going to be one of our better years," he said.
Mr. Pickens, who manages more than $2 billion in investments at his Dallas-based BP Capital, has accurately predicted trends in commodity prices since oil was around $40 a barrel in the spring of 2004.
His latest projection, that oil would hit $70 before $50 again, proved true in August when crude reached $70.85 a barrel.
Oil for December delivery fell 78 cents Wednesday to $58.93 on the New York Mercantile Exchange.
Demand should pick up in the next nine to 12 months, pushing oil back toward $60 a barrel, Mr. Pickens said.
Over the long term, Mr. Pickens remains bullish on oil because of what he sees as a peak in global oil production.
"I don't think you can get supply much beyond 85 million barrels," he said, which is just above the daily global oil production today.