This is a partial transcript from Your World with Neil Cavuto, July 22, 2002, that was edited for clarity. Click here for complete access to all of Neil Cavuto's CEO interviews.
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NEIL CAVUTO, HOST: It has been the one pleasant surprise this summer, gasoline prices holding stable. But is something about to undo that? Oil industry watcher Tom Petrie of Petrie Parkman fame fills us in. Tom, good to have you.
TOM PETRIE, CEO, PETRIE PARKMAN: Good to see you, Neil.
CAVUTO: Now, is your premise this is not going to last that long?
PETRIE: This being the high price of oil?
CAVUTO: Well, the low prices of gasoline, or at least stable prices.
PETRIE: The stable prices is the correct thing. Yes, I think that this year, stability is probably the order of the day, relatively stable. The season is over for peak gasoline demand and will go into the fall with a normal seasonal drop-off. Next year, we're going to have ample crude supplies. And if anything, that could put some pressure on product prices.
CAVUTO: All right. What kind of pressure?
PETRIE: Well, there are a lot of different scenarios right now, Neil. And depending on just how this negative wealth effect works out, next year will be a pretty interesting year for the economy. If that effects final demand, then we could see crude oil back in the low 20s, and that would suggest gasoline prices that would be lower than they were this year.
CAVUTO: So, for those who were worrying about, you know, inflation and energy, if they are holding to your view, it ain't going to happen?
PETRIE: Well, there is a lot of other factors at work right now...
CAVUTO: Absolutely. Like an attack on Iraq, right?
PETRIE: Well, that's right. That's a big one right there. And certainly between now and next spring, the likelihood of something happening on that front is pretty high in my view.
CAVUTO: An attack, you're saying, is pretty high on that?
PETRIE: I think so.
CAVUTO: OK. Then play it out. What happens when that happens?
PETRIE: Well, there will be the normal knee-jerk reaction. The commodity markets will rally on that without question. Our experience in the past which suggest that whenever that happens, it is a pretty compressed timeframe, and then we go back and do downward pressure usually in the aftermath of that kind of an event.
CAVUTO: Do you find oil as an investment benefiting when everything else seems to stink or no?
PETRIE: Well, certainly in the '70s, that was the case. And there are rough analogies between the time we are now in and the '70s. We are dysfunctional in a lot of our policymaking in Washington, and especially with regard to energy. So I think sometime, middle of this decade, thereabouts, will be back in the soup with respect to the kind of energy policies we have creating unnecessarily tight conditions. And that will remind us of the '70s. But I do not think it is right around the corner.
CAVUTO: Tom Petrie, always a pleasure, my friend. Thank you very much.
PETRIE: Good to talk to you.
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