MEMO: Oil Companies INTENTIONALLY LIMITED REFINING CAPACITY 2 RAISE PRICES

[theearthisround]

http://www.informationliberation.com/index.php?id=1050

SANTA MONICA, Calif., Sept. 7 /U.S. Newswire/ -- The Foundation for Taxpayer and Consumer Rights (FTCR) today exposed internal oil company memos that show how the industry intentionally reduced domestic refining capacity to drive up profits. The exposure comes in the wake of Hurricane Katrina as the oil industry blames environmental regulation for limiting number of U.S. refineries.

The three internal memos from Mobil, Chevron, and Texaco (available at http://www.consumerwatchdog.org/energy/fs/ show different ways the oil giants closed down refining capacity and drove independent refiners out of business. The confidential memos demonstrate a nationwide effort by American Petroleum Institute, the lobbying and research arm of the oil industry, to encourage the major refiners to close their refineries in the mid-1990s in order to raise the price at the pump.

"Large oil companies have for a decade artificially shorted the gasoline market to drive up prices," said FTCR president Jamie Court, who successfully fought to keep Shell Oil from needlessly closing its Bakersfield, California refinery this year. "Oil companies know they can make more money by making less gasoline. Katrina should be a wakeup call to America that the refiners profit widely when they keep the system running on empty."

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-- An internal Chevron memo states; "A senior energy analyst at the recent API convention warned that if the US petroleum industry doesn't reduce its refining capacity it will never see any substantial increase in refinery margins." It then discussed how major refiners were closing down their refineries. Read the Chevron memo at http://www.consumerwatchdog.org/energy/fs/5103.pdf

(more)
http://www.informationliberation.com/index.php?id=1050

[MadHound]

1. This isn't new friend, so what should we do about it?

Get the government to force Big Oil to start refining more gas? That isn't the answer, especially in the long term. Peak Oil, if it isn't already here, is just around the corner. Lowering the price of gas and other petroleum products would just lull the populace to sleep until it is too late and there is no more oil to refine.

Rather, think of this as an early wake up call. You want to screw Big Oil, then let us all start reducing our consumption. By reducing our consumption, by switching to alternative, renewable resources we will free ourselves from our collective oil addiction, clean up our air and water, forgoe the need to wage wars for oil, and put Big Oil out of business.

But trying to instigate legal or other governmental procedings in order to bring down problems is only going to exacerbate the problem, and make matters worse in the long run. It has been shown time and again that the American people won't get off their asses to do a damn thing unless it benefits their wallet. Therefore, we should be using this discontent not to bring prices back down, but to kick Big Oil to the curb for good.

[cthrumatrix]

2. oil mergers closed 50% of US refineries over 25 yrs and the govt

approved this knowing that energy was always going to be a

national security issue -- hell Carter said as much in 1974.