Pickens: Russia Is Likely To Join OPEC Soon
During a gathering of the nation’s mayors, the billionaire alternative energy advocate and former oilman, T. Boone Pickens, predicted that Russia will likely join the Organization of Petroleum Exporting Countries in the near future.
Such a turn of events “will not be favorable to the United States,” Pickens told the 77th Winter Meeting of the United States Conference of Mayors in Washington, D.C.
Mr Pickens is the creator of the now famous “Pickens Plan,” which calls for reducing America’s dependence on foreign oil by one-third in 10 years with a combination of natural gas and wind power picking up the slack.
“I hope he is wrong, but I agree with the underlying premise – the idea of a cartel in a free market is reprehensible, and I think Mr. Pickens wants to leverage that outrage,” Tom Kloza, Chief Oil Analyst at the Oil Price Information Service, told Consumer Energy Report.
Earlier this month, in a speech at Rice University in Houston, Pickens predicted that the price of crude oil will rise above $100 per barrel by the end of next year.
He believes that public funds are needed in order to implement his plan, and is seeking the support of President-elect Barack Obama and the nation’s mayors.
After today’s meeting in Washington, he told reporters that he has the backing of 187 U.S. mayors, and that he has twice met with Obama’s transition team regarding his energy plan.
During his speech at Rice University, he lambasted the government for not understanding the nation’s energy needs.
“The leadership in Washington has never understood energy,” Pickens told the audience. “I would say we have a better chance with President-elect Obama than we would [Sen. John] McCain.
“Waiting for the free market can be disastrous,” he said. That’s why he’s seeking financing from the federal government. “We have got to get this in the first 100 days if we don’t get it in the stimulus package.”
Pickens is urging the government to bring about a mandate to place 350,000 natural gas-powered, 18-wheel trucks on the road, with $30 billion in federal incentives to encourage people to buy the vehicles. If this were to happen, he expects to have reduced America’s dependence on foreign oil by more than 5%.
Russia is also leading the way in the creation of a natural-gas cartel which would mirror OPEC’s hold on the oil markets.
Venezuelan President Hugo Chavez, said last week that he believes that OPEC is prepared to make further production cuts if necessary in order to prop up prices from their current levels.
“We will make the reductions that have to be made,” Chavez, whose country is a member of OPEC, said during an address to Venezuela’s Congress. “I am sure what I am saying is what all the heads of government and heads of state think in all the OPEC countries.”
The potential impact of Russia allying itself with OPEC’s policies may place a strain in U.S. – Russian relations just as Barack Obama is expected to take office.