OIL COMPANIES SHUT REFINERIES TO DRIVE UP PROFITS

[underpants]

You won't hear that from the oil industry.

Both links are dated September 7, 2005.


http://www.huffingtonpost.com/jamie-court/memos-show-oil-companies-_b_6980.html

Take this internal Texaco strategy memo: "he most critical factor facing the refining industry on the West Coast is the surplus of refining capacity, and the surplus gasoline production capacity. (The same situation exists for the entire U.S. refining industry.) Supply significantly exceeds demand year-round. This results in very poor refinery margins and very poor refinery financial results. Significant events need to occur to assist in reducing supplies and/or increasing the demand for gasoline." The memo went on to discuss a successful campaign in Washington State to shrink refined supply by removing other additives in the gasoline that filled gas volume.

Another Mobil memo shows the company promoted tough regulations in California to shut down an independent refiner. A Chevron memo acknowledged the industry wide need to shutter refineries and discussed how refiners were responding in kind.

Internal Memos Show Oil Companies Intentionally Limited Refining Capacity To Drive Up Gasoline Prices

http://www.consumerwatchdog.org/energy/pr/?postId=5110

The three internal memos from Mobil, Chevron, and Texaco (Click here to read the memos.) 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.

[AX10]

1. k/r

[JuniperLea]

2. I was just mentioning this fact over here...

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=364&topic_id=1021725&mesg_id=1021781



Oh, yeah... I'm sure Halliburton builds a mean refinery...

[wishlist]

3. It's not environmental regulations that are stopping refinery building

There is no incentive for the oil companies to build more refineries. Right after Katrina several oil experts on CNBC talked about how companies could easily get new refineries built in the Gulf region, in fact one even got approval several years ago but decided not to invest the money since they can just keep using existing refineries and keep the supply limited and price high.

[ClintonTyree]

11. And the Bush Administration is giving them "tax incentives"....

excuse fucking me? :wtf: Our government is GIVING these bastards tax rebates so they can better shove it up our asses? :grr: This shit needs to come to a screeching fucking halt, NOW!

[Old and In the Way]

4. Where's Teddy Roosevelt and the trustbusters when you need them?

Really, this is getting obscene.

[kentuck]

5. K & R !

I would recommend changing the thread title to something more urgent to draw more readers. This is a very important post!

[underpants]

8. |

How's that.

You post about them shutting them down sent me off googling. I totally stumbled onto this. I am sending it to Air America and Congressman Bobby Scott.

[LSK]

12. OIL COMPANYS SHUT REFINARIES TO DRIVE UP PROFITS

Try that.

[underpants]

14. |

Done

[ClintonTyree]

6. Didn't the Kuwaitis offer to build an entire oil refinery....

in the U.S. gratis after Hurricane Katrina? And weren't they turned down by the Bush Administration? I seem to remember this.....off to do some research.

Here we go. I guess it wasn't completely gratis and it wasn't the Bushies that turned it down. It's Big Oil itself that has no interest in building it. I can't imagine why? :eyes:

<snip>
"The growth at existing facilities has been less than half the pace of demand, according to the U.S. Energy Department. Saudi Arabian oil minister Ali al-Naimi said in Dallas in April 2004 that his nation stood ready to finance and build new refineries in the U.S. No companies took up the offer for new plants.

A U.S. refinery venture owned by Saudi Aramco and Royal Dutch Shell Plc are studying a plan to double the size of the existing 275,000 barrel-a-day plant in Port Arthur, Texas, an expansion that would be the biggest in the U.S. in at least 25 years.

The last new refinery built in the U.S. was Marathon Oil's Garyville, Louisiana, plant, which opened in 1976.

http://quote.bloomberg.com/apps/news?pid=10000103&sid=aRO9eoUFGypc&refer=news_index


So there you have it. BIG OIL in this country has no interest in expanding refining capacity. It's in their best interests, price gouging-wise, to maintain the status quo.

[Ksec]

7. But theyve been blaming Dems for years

We have blocked ALL refinery startups.....according to the fatcats.

[SoCalDem]

18. They discovered early on that they could "use" environmental

regulations as the scapegoat issue. Every time the issue of refineries comes to the surface, they all start yelling in unison."We WANT to build refineries but"...:

1. They are expensive and we don;t make enough money (can't use that one anymore)
2. People don't want them in their back yards (NIMBY)
3. The evil tree huggers won't let us (the real scoop- they want to pollute with impugnity..they are not "rules folks")

[Roland99]

9. There have been expansions at some refineries, though.

[LSK]

10. K & R

[The Backlash Cometh]

13. And yet the Republican politicians claim that the oil companies need

that extra revenue to drill domestically AND to build more refinaries.

Someone's lyin to us.

[wiggs]

15. OPEC does it....Enron did it....price manipulation. nt

[LSK]

16. kick

[NewJeffCT]

17. They will still blame it all on environmentalists

I'm on another board (non political normally) and it seems half the thread is complaining about hippies & environmentalists.

[Bushwick Bill]

19. To their defense...

Well, the NIMBY argument is completely idiotic. If big oil wanted refineries, with these madmen in office, they would get them.

If they are deliberately shutting them, that is bullshit.

If other countries are offering to build them, then it should happen.

But, yes, they have no incentive to build more. (A) They can gouge us and (B) There's this:

September 6, 2005,
...
There have been no new oil refineries built in the US since the late 1970s. There will be no new ones built now, despite the crunch on refined "product." Why? Because the oil companies understand that they are in a twilight industry and refineries represent huge investments in future activity, which the corporations correctly perceive will be shrinking as global oil production passes peak.
http://www.kunstler.com/mags_diary15.html

The fact that there is virtually no exploration or refinery construction means that the majors understand clearly that there is no more significant oil to find and their investments would never be paid off.
http://www.fromthewilderness.com/free/ww3/012505_ftw_maps.shtml

If the actions—rather than the words—of the oil business’s major players provide the best gauge of how they see the future, then ponder the following. Crude oil prices have doubled since 2001, but oil companies have increased their budgets for exploring new oil fields by only a small fraction. Likewise, U.S. refineries are working close to capacity, yet no new refinery has been constructed since 1976. And oil tankers are fully booked, but outdated ships are being decommissioned faster than new ones are being built.
http://www.technologyreview.com/articles/05/02/issue/review_oil.asp?p=0

[NewJeffCT]

21. good points

Not just Bush in office... but, the previous Bush & Reagan, too. Not one new refinery.

[Fridays Child]

20. k/r