Charlie Maxwell Says $300 Oil Inevitable

Charles (Charlie) Maxwell, Senior Energy Analyst at Weeden & Co., told Barrons he thinks $300 oil is "inevitable." With three or four new Saudi oil fields coming on line soon, Charlie thinks supply and demand are roughly in balance for the next two years. Charlie predicts oil prices between $75 and $115 for awhile. After that, he sees prices soaring again.

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Other key comments from the Barrons interview:

Natural Gas:

• "Its supply should last another 40 or 50 years before it runs into the same problems of peaking that we have in oil. "
• "Natural gas has a very low carbon footprint, meaning it's a cleaner type of energy, and it has wonderful petrochemical adaptability. "

On Hubbert's Peak:

• "(He) said that we would reach the limit of domestic production of oil in the continental United States in the early 1970s.... and he was correct"
• "He thought the American public would never be stupid enough to fall for the concept of foreigners continuing to give us all the oil that we wanted."

More on $300 Oil:

• "We will see $300 a barrel -- or roughly $250 in today's dollars -- because oil supply will be so short. "
• "That ($300 oil) will be in 2015."
• "But even earlier, around 2010, more than 50% of the non-OPEC world will have peaked in its production of oil so the dependence on OPEC will become extreme. That will give OPEC a chance, I'm afraid, to lift prices rather more quickly on us than they are doing today."

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The above summarizes an article in the Monday September 8, 2008 Barrons (available today, Saturday September 6) titled "What $300-a-Barrel Oil Will Mean for You" By Lawrence C. Strauss.
Article Subtitle: "AN INTERVIEW WITH CHARLES MAXWELL: He correctly predicted the recent price spike -- and he sees an eventual move to around $300 a barrel."