HOUSTON — Legendary Texas oilman T. Boone Pickens sees the price of oil hitting $100 a barrel perhaps as soon as the fourth quarter but certainly sometime next year, a consequence of daily global oil production reaching its peak.
The 79-year-old former wildcatter, who now heads the Dallas-based hedge fund BP Capital Management LP, said Friday afternoon he has no doubt worldwide demand has topped the current global output of roughly 85 million barrels a day. As such, he said, prices have nowhere to go but up.
"I think you'll reach $100 (a barrel) before you go back to $80," Pickens said before speaking at a gathering of the Association for the Study of Peak Oil and Gas at a downtown hotel. "It could happen in the fourth quarter, but you'll see it within a year."
Crude prices have climbed 28 percent since late August, passing $90 a barrel for the first time in overnight trading Thursday. Light, sweet crude for November delivery eventually fell 87 cents to settle at $88.60 on the New York Mercantile Exchange.
Pickens is credited with a history of prescient predictions about the direction of oil markets, and his bets have paid off handsomely. BP Capital, which focuses on energy-related investments, began a decade ago with $125 million and now manages about $4.5 billion.
Still, many industry and government analysts are far less pessimistic about the prospects for the global oil supply than the billionaire Pickens. Experts disagree about when daily oil output will reach its maximum level — or whether it has done so already. The federal Government Accountability Office reported in March that most studies have found oil production will reach a peak sometime between now and 2040.
Going forward, Pickens said, rising demand will be met by higher prices rather than ever-larger crude production. "Any alternative fuel has a chance," he said, though he's betting big on wind.
In June, Pickens announced plans to build the world's largest wind farm in West Texas. He said the gradual switch from fossil fuels to alternative energy sources is going to require a fundamental change in the world, "and it will impact lifestyle."
As for his wind project, which could cost as much as $6 billion, Pickens hopes to have it up and running in eight years.
Pickens started his career in the 1950s as a petroleum geologist, formed his reputation in the following decades as the founder of Mesa Petroleum Co. and assured his legendary status in the 1980s with attempts to acquire major oil companies.
