Oil prices could reach as high as $120 a barrel this year, oil billionaire T. Boone Pickens said Tuesday.
“You’ll see it over $100 a barrel, not $100 average over the year,” Pickens told National Journal in a phone interview. “But you could see it as high as $110 to $120 a barrel.” And those prices, he said, would translate into about $4 per gallon of gasoline at the pump.
He said the high gas prices should compel Congress to enact an energy plan. “When you get into that [gas price] area people will become focused and very concerned, which will mean Congress will become very concerned,” said Pickens, whose career in the oil industry took off in the 1970s and ‘80s and has more recently shifted into the financial sector. He added that he thinks predictions made by some energy experts that gas prices could reach as high as $5 a gallon in the next two years is a long shot, but he wouldn’t rule it out. Regardless, gas prices continue to go up, he said.
Gas prices have spiked since the end of November: from $2.88 to $3.07 a gallon this week, according to the Energy Information Administration. If oil and corresponding gasoline prices continue to rise, the problem—and solutions to solve it—would take center stage on Capitol Hill.
“Everybody would be tripping over themselves to fix the problem,” Sen. Lindsey Graham, R-S.C., said late last month in the Capitol. “We’re a headline-driven Congress, so you’re going to look at $4-gallon gas, and we’re all going to come in here and do something about it.”
Incoming House Energy and Commerce Committee Chairman Fred Upton, R-Mich., had similar words Tuesday after a luncheon address by American Petroleum Institute President Jack Gerard. “We’ve got problems ahead of us that we have to be prepared for,” Upton said, after citing the latest prices of both oil and gasoline.
Specifically, Pickens wants Congress to pass legislation he has backed to address the problem. His measure would offer tax incentives as a way to encourage the use of natural gas as a fuel for heavy-duty vehicles like semi trucks and moving vans. The policy has bipartisan support in both chambers of Congress. It did not pass because lawmakers could not agree on a way to pay for the $5-billion bill, which had been offset by increasing taxes on the oil and gas industry.
Pickens may have been down for the count last Congress, but he’s already making the rounds for the 112th Congress. He spoke with President Obama’s top adviser, David Axelrod, shortly after the November elections to talk about the chances of passing the bill in the lame-duck session and the prospects for it this year. He has met with presumptive House Speaker John Boehner, R-Ohio, since the election and is working to schedule a meeting this month with Upton, who supported Pickens’s bill in the last Congress. Pickens said he has also been in touch with many other lawmakers.
“I think they got very busy at the end of the year, and it got kind of pushed off the table,” Pickens said. “I think it’s going to come up pretty quick.” He added, “We’ll get it introduced. We’re going to get it passed.”
Evidence suggests that some type of legislation on natural gas could likely come up in the 112th Congress. Obama has continually cited natural gas as an area where the parties could find agreement, and Senate Majority Leader Harry Reid, D-Nev., is a big fan of Pickens and his plan.