Home | Business News | Browse by Publication | M | Mergers & Acquisitions: The Dealmaker's Journal

More Pain at the Pump? In an interview with FOX Business Network at ACG InterGrowth, T. Boone Pickens predicted oil will hit $75/barrel by the end of the year. How is your firm playing the energy sector, how does the current economy factor into your strategy? Will it take more "pain at the pump" to strengthen the push toward alternative energy sources?

Article Excerpt
Byline: Editorial Staff

The problem with "pain at the pump" is that it never lasts long enough to induce permanent buyer behavior. This was evident back in the '73 and '79 gas crises and was repeated again during the summer of 2008. Until we have a real energy policy in the US that will regulate the price of gasoline in a predictable and limited range over a long time span all businesses whose products are reliant on fuel price will be whipsawed. Look at the automotive sector. Look past today's headlines and instead gage off previous historical cycles and long term trends. That's what companies like Exxon do. Exxon didn't start drilling last summer when oil was at $147 per barrel. They remembered getting burnt badly back in 1979 and were waiting for validation that this price would hold. It didn't.

The current clean energy capital of the...

View this article FREE - Now for a Limited Time, try Goliath Business News
Free for 3 Days!