Oil industry scales back refinery plans

Source: ap



http://news.yahoo.com/s/ap/20070617/ap_on_bi_ge/ethanol_refineries;_ylt=AhoqxpbuGP3SjUTbC6G_mzGs0NUE


Oil industry scales back refinery plans

By H. JOSEF HEBERT, Associated Press Writer 30 minutes ago

WASHINGTON - A push from Congress and the White House for huge increases in biofuels, such as ethanol, is prompting the oil industry to scale back its plans for refinery expansions. That could keep gasoline prices high, possibly for years to come.



With President Bush calling for a 20 percent drop in gasoline use and the Senate now debating legislation for huge increases in ethanol production, oil companies see growing uncertainty about future gasoline demand and little need to expand refineries or build new ones.

Oil industry executives no longer believe there will be the demand for gasoline over the next decade to warrant the billions of dollars in refinery expansions — as much as 10 percent increase in new refining capacity — they anticipated as recently as a year ago.

Biofuels such as ethanol and efforts to get automakers to build more fuel-efficient cars and SUVs have been portrayed as key to countering high gasoline prices, but it is likely to do little to curb costs at the pump today, or in the years ahead as refiners reduce gasoline production.

A shortage of refineries frequently has been blamed by politicians for the sharp price spikes in gasoline, as was the case last week by Sen. James Inhofe, R-Okla., during debate on a Senate energy bill.

Read more: http://news.yahoo.com/s/ap/20070617/ap_on_bi_ge/ethanol_refineries;_ylt=AhoqxpbuGP3SjUTbC6G_mzGs0NUE

robber barons bankrupt our country?

:thumbsup:

Oil dependence high + demand high + supplies less + prices higher= profits higher

Gas prices are (supposedly) high because there is not enough refinery capacity to keep up with demand.

Oil companies aren't going to build any new refineries because there isn't enough demand to justify building them.

That's just a fucked up argument.

perfectly good refineries that could probably be restarted with a bit of work.

And, as we all know perfectly well, environmentalists are the cause of all the problems -- not the inherent greed of multinational corporations, or people just interested in making a quick buck -- but people who seem to think that regulating refineries are the issue. People who think that that we can breathe and live and raise our children in at least a semi-healthy world, and do so without a large difference in the quality of life we lead. Damned tree-huggers! :crazy:

:sigh:

Or oligopoly if you prefer. Maybe that should be oiligopy.

They will claim that the consumption of gasoline will go down, so they won't increase refinery capacity, then work like hell to make sure consumption goes up so the market drives the prices up.

And what have they been doing with their record profits for the past few years, anyway?

There is no incentive for oil companies to do what is right for the economy and the country. Time to do it for em.

and anti-trust laws stopped all negotiating from happening between competing firms, but, that's soooo pre-911

Short term pain, long term gain - for us.

They are a nasty lot, aren't they?

Seeing as how peak oil is just around the corner, and they'll have more refining capacity than oil supplies. They'd never recoup their costs before the oil is gone.

:kick:

Edit: Oh, you want to really get pissed off? Listen to these reports on the U.S. Auto Industry from today!

(Correct me if I'm wrong but, Isn't this the definition of a Conspiracy!?!)

"Not worthwhile to build new refineries when there's no guarantee of recouping profits like they have now"

Not enough for them to make money--they need to be breaking profit records for them to consider it "worthwhile"

The reason that big oil doesn't want to build any new refineries is that no one wants to build the last one. A refinery is a 40-50 year investment - and if you've got nothing to refine...

increases prices. It's an old game.

My husband is working on a refinery expansion for hydrogen. It took nearly a year to get EPA approval and it's going to cost nearly $1B.