Egyptian billionaire Naguib Sawiris sees oil at $100 in 18 months, says he would buy airlines
Egyptian billionaire Naguib Sawiris says he will buy airlines against fellow billionaire investor Warren Buffett, who announced at the company’s annual meeting on Saturday that Berkshire Hathaway had sold all of its airline shares..
Naguib Sawiris, Chairman and CEO of Orascom Investment Holding and the only one licensed to do telecommunications business in North Korea, told CNBC on Tuesday that he sees an opportunity not only in airlines, but also in tourism, hotels and the internet sector..
«Opportunities arise with every crisis, Sawiris said. – You can go and buy an airline today for $ 1 if you take on most of the debt».
U.S. airline stocks have plummeted this year as demand for air travel has almost stalled, more than 95% lower due to the coronavirus pandemic. According to Johns Hopkins University, the disease has infected more than 3.6 million people worldwide and killed at least 256,000..
Sawiris, speaking from Cairo, said he agreed with the President of the United States Donald Trump in the administration’s controversial drive to open up America’s economy.
US stocks rose on Tuesday on expectations that the US economy could start to reopen. Sawiris said that it «one of the few times», when Trump is right. «They may not find a cure, they may not find a vaccine, for how long will we be in prison in our homes?», – the billionaire wonders.
Sawiris said the price war between the de facto OPEC leader Saudi Arabia and Russia was «calculated» an attempt to kill the oil shale industry in the United States, and that the Saudis «got it right» oil in the long run.
In March, OPEC and other major producers associated with it were unable to agree on a production cut as the coronavirus began to stifle oil demand. Prices hit an 18-year low before the alliance reached an agreement to cut 9.7 million barrels per day in April, which is 10% of global production and the largest production cut in history..
Asked if oil would have reached the same level if the March deal with OPEC + had been reached, Sawiris explained that prices would still fall due to reduced consumption, «but would not fall to this level».
«I think it was calculated, ”he said. “I think they knew it was going to happen, and they still wanted to do it, because by killing a competitor, the price would go beyond $ 50 or $ 60. So I really believe oil will hit $ 100 in 18 months.».
Oil jumped 20% on Tuesday as global economies begin to slowly reopen after months of forced halt and optimism about a potential recovery in demand.