This'll be 'best investment in the world': Rubenstein
Philanthropist and billionaire private equity professional David Rubenstein has told CNBC that oil prices will bounce back over time and will make carbon-related energy assets one the best additions to any investor's portfolio.
Speaking from Johannesburg, the co-founder and co-chief executive of The Carlyle Group (CG), reiterated his bullishness on the sector and labeled renewable energy as less efficient and cost-effective.
"In time (oil) prices will come back, in time demand will catch up with supply, and in time I do believe that carbon-related energy will turn out to be one of the best investments in the world," he told CNBC Tuesday.
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"The consumption of energy is something that we need to do to make the world go forward."
The asset management firm has $193 billion of assets under management, according to its website, and currently has $10 billion-$12 billion of "dry powder" to spend in the energy sector.
Oil majors and U.S. shale producers have been hit hard by a dramatic fall in the price of oil since mid-June last year. Brent crude (Intercontinental Exchange Europe: @LCO.1) and WTI have recently dipped back below the $50 a barrel level after a brief rally in the second quarter of 2015.
Throughout this period, Rubenstein has maintained his optimism, however, and told CNBC that he was "finding assets that are now for sale at much lower prices."
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"We are, in the United States and outside the United States, very active," he said. "I don't want to predict any wide-scale declines in the value of all these (oil) companies but I do think there will be opportunities to buy things at lower prices."
The dip in commodity prices means that funds like the Carlyle Group have faced challenges and have realized losses from the assets that they already own, despite also being able to pick up some potential bargains.
The Wall Street Journal reported late Friday that The Carlyle Group had seen one of its funds sustain hefty losses because of the price declines in raw materials. Citing unnamed sources close to the firm, the publication said that its Vermillion Asset Management firm had seen holdings in its flagship fund fall to less than $50 million, from about $2 billion a year ago.
Without commenting directly on the fund, Rubenstein told CNBC that his company owned some existing assets that were "going down," but added that the group was generally "in pretty good shape."
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