05/02/2012 07:59 am ET Updated Jul 02, 2012

T. Boone Pickens Dances the Saudi Oil Polka

There he was on CNBC, of course, the man most identified with and heralded as the ultimate oil guru -- T. Boone Pickens being interviewed by Maria Bartiromo on April 30. Being the consciousness reporter that she is, amidst Pickens' musings on natural gas and other vistas of the oil/energy patch, Bartiromo quite naturally asked Mr. Pickens where oil prices were heading.

Well, they were headed up, said the man and then explained, well, you see the Saudis are maxed out. They can't produce more. And there in one fell swoop, he gave the Saudis a free pass on the current oil price distortions and turned the Saudis from being the OPEC cabal's malevolent gorgon into our heroic good guys, doing all they can pumping away, trying to come up with as much oil as they can, but unable to meet our ravenous appetite to thereby keep oil prices in check. Totally in line with the Saudi propaganda line, that their capacity is being pumped full out, but they can only do so much. So please pay and don't complain, and the more you pay the better off we (the Saudis) and Mr. Pickens' oil investments will be.

Mr. Pickens, as knowledgeable as he is purported to be on oil matters, and now seemingly on Saudi oil issues, fails to remind us nor the Saudis, of course, of the study Aramco, Saudi Arabia's state-owned national oil behemoth fashioned in 1970's. It was a comprehensive plan calling for Saudi Arabia to increase its production capacity to 20 million barrels a day by the 1990's (today, in 2012 it is purported to be 12 million barrels/day). One wonders what happened to that study which was widely heralded at the time and envisaged as a safety net for a massively burgeoning oil consuming world economy.

Nor in assuaging us of Saudi Arabia's heroic efforts and good works did Mr. Pickens make any reference to the crafted distortion of what is accepted wisdom of Saudi national oil reserves at some 260 billion barrels.

This in spite of a revelationary first page article that appeared in the New York Times on March 5, 2007, "New Innovations Pumping New Life Into Old Wells," whereby Nansen G. Saleri, head of reservoir management of Aramco, said that he estimated, with new drilling technologies, that potential reserves were three times the officially published figure of 260 billion barrels. The estimate he gave then was 716 billion barrels, and he added he "wouldn't be surprised" if ultimate resources reached 1 trillion barrels. The new technology has over the last few years vastly expanded the oil and gas reserves of the United States. One can only imagine what its prospects are for Saudi Arabia.

In closing, to make us feel better Mr. Pickens ventured that we in the United States are fortunate to have the lowest oil and gas prices in the world. It seems when and if Mr. Pickens visits his friends in Saudi Arabia, he is chauffeured and comes into no contact with a gasoline pump where gas is selling for some 61 cents per gallon.

Oh yes, it is understood Mr. Pickens has had almost open access to the White House. Could there be a correlation to the energy mess we are living now?