Monday, July 15, 2013

Expect $50 oil, but not $2 gas, Gulf Oil CEO says

Oil prices should be about half of today's $105 a barrel by the end of the year, Gulf Oil CEO Joe Petrowski predicted on CNBC on Monday.
He stressed on "Squawk Box" that this trend is mostly on the supply side because record amounts of oil and natural gas are being produced in the United States and in Canada and OPEC supplies are higher.
But "$50 [a barrel] oil does not translate into $2 gasoline," he said, because it still has to be refined and transported.
In the past three months, the price of oil has risen 20 percent. And that's pushed gas prices up 14 cents in the past week alone to $3.613, according to AAA's Daily Fuel Gauge Report.
Making his case for a steep crude drop, Petrowski said, "Traveling is picking up, but we're using much less oil. In fact, we're using no oil in the energy sector. [And] natural gas is taking a lot of the heating sector away."
But he said the slightly weaker demand for oil is not cause for concern in terms of overall economic growth.
—By CNBC's Matthew J. Belvedere. Follow him on Twitter @Matt_SquawkCNBC. Lori Ann LaRocco also contributed to this report. Follow her on Twitter

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