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Shale-oil baron Harold Hamm says prices are headed to $75 a barrel, regardless of the outcome of rising aggressions in the Middle East that has sent crude to multimonth highs:
‘I think we’re probably headed for $75 oil price in the next six months. That’s where the market’s going, and we’ll get there. It’s not too much to ask.’
Hamm said during a CNN interview Monday that the market is headed toward a “tightening of supplies” regardless of what happens in the Mideast. “I’m not terribly worried what’s going right down in Iran,” he said.
Comments from the founder of Continental Resources Inc. CLR, +2.09% , a $13 billion shale-oil company, come after a U.S. strike on Friday killed Major Gen. Qassem Soleimani, the leader of the foreign wing of Iran’s Islamic Revolutionary Guard Corps, on Iraqi soil — an act of aggression that has the potential to ignite conflicts in the oil-rich Middle East, and harm global crude production.
Crude-oil prices climbed Monday, with the benchmarks touching their highest levels in at least seven months in early action. West Texas Intermediate crude for February delivery CLG20, +0.33% was virtually unchanged at $62.97 a barrel on the New York Mercantile Exchange, after giving up earlier gains that sent it to an intraday peak at $64.72, according to FactSet data. A jump to $75 for WTI would represent a more than 19% increase from current levels.
Iran has vowed to avenge the death of the general, and Iraq’s parliament has threatened to expel U.S. troops from the country, which has caused President Donald Trump to counter with a threat of sanctions against Baghdad.
The Dow Jones Industrial Average DJIA, -0.04% , the S&P 500 index SPX, +0.15% and the Nasdaq Composite Index COMP, +0.32% were trading off their Monday lows but have been under selling pressure as investors weigh the possibility of a broader conflict engulfing the Middle Eastern region.
Hamm on CNBC said that he doesn’t see a move to $75 a barrel by U.S. benchmark WTI as a big jump, given the health of the U.S. economy. He did say that he believed that members of the Organization of the Petroleum Exporting Countries want to see oil at $80. He didn’t clarify as to whether he meant U.S. oil or the global benchmark Brent.
March Brent crude BRNH20, -0.01% was at its highest level since around May, briefly touching a intraday Monday high at $70.74.
Hamm was replaced as CEO at Continental Resources by William Berry, a former ConocoPhillips executive and Continental board member. Hamm currently serves as executive chairman of the company. Last year, Continental Resources saw its shares decline 14.7%, compared against a decline of 10.7% for the exchange-traded SPDR S&P Oil & Gas Exploration & Production XOP, +1.23% , a 32.6% gain for the U.S. Oil Fund LP USO, +0.38% and a 4.7% rise for the Energy Select Sector SPDR ETF XLE, +1.24% .
The CNBC interview appears below:
