Originally Posted By Disneyman55 <a href="http://www.cnn.com/2005/POLITICS/10/07/katrina.energy.ap/index.html" target="_blank">http://www.cnn.com/2005/POLITI CS/10/07/katrina.energy.ap/index.html</a> This article on CNN talks about streamlining the process to build new refineries and the battle faced in Congress to get it done. It becomes pretty obvious what the real cause of high gas prices is. The law of supply and demand indicates that as supply shrinks, demand increases causing the price of the commodity to rise. The reason we are paying so much for gas isn't because of less oil but because our demand has outstripped our current supply of gasoline coming from refineries. Why? Because there are not enough refineries to keep up with demand. Why? Because knuckleheads and special interest groups make it impossible to build new refineries. Next time you fill up your fuel efficient Toyota (37 miles to the gallon) and it still costs you $50 to put in 15 gallons you can thank the special interests for it. I suggest you send them the credit card bill.
Originally Posted By TomSawyer >>Why? Because knuckleheads and special interest groups make it impossible to build new refineries.<< Please don't forget the knuckleheads in the oil industry who capped off wells to build housing developments in Southern California.
Originally Posted By Disneyman55 Tom, I highly doubt that the wells that were capped off were producing much anymore. Not to mention the fact that the amount of oil they were providing wouldn't even be a drop in the bucket compared to the amount of oil that is currently in backlog, waiting to be refined!! Less refineries = less refined product, no matter how much oil is available. Less refined product = higher demand = higher prices. Economy 101
Originally Posted By TomSawyer US oil producers shut down oil refineries when the price of oil collapsed in the mid-1980s. It wasn't the environmentalists but the market that reduced our capacity. Blaming it on environmentalists is just another lie. <a href="http://www.eia.doe.gov/emeu/cabs/usa.html" target="_blank">http://www.eia.doe.gov/emeu/ca bs/usa.html</a> "The United States experienced a steep decline in refining capacity between 1981 and the mid-1990s. Between 1981 and 1989, the number of U.S. refineries fell from 324 to 204, representing a loss of 3 million bbl/d in operable capacity (from 18.6 million bbl/d to 15.7 million bbl/d), while refining capacity utilization increased from 69% to 87%. Much of the decline in U.S. refining capacity resulted from the 1981 deregulation (elimination of price controls and allocations), which effectively removed the major prop from underneath many marginally profitable, often smaller, refineries. Refinery closures have continued since 1989, bringing the total number of operable U.S. refineries to 149 in 2003. In general, refineries that have closed have been relatively small and have had less favorable economics than other refineries in their market area. Also, in recent years, some smaller, less-economic refineries that had faced additional investments for environmental reasons in order to stay in business found closing preferable because they predicted that they could not stay competitive in the long term. While some refineries have closed, and no new refineries have been built in nearly 30 years, many existing refineries have expanded their capacities. As a result of capacity creep," whereby existing refineries create additional refining capacity from the same physical structure, capacity per operating refinery increased by 28% over the 1990 to 1998 period, for example. Overall, since the mid-1990s, U.S. refinery capacity has increased from 15.0 million bbl/d in 1994 to 16.9 million bbl/d in September 2004. Also in September 2004, utilization of operating capacity at U.S. refineries was averaging around 90%, down from 97% in July and August. Although financial, environmental, and legal considerations make it unlikely that new refineries will be built in the United States, expansion at existing refineries likely will increase total U.S. refining capacity in the long-run."
Originally Posted By peeaanuut its the greenpeace nuckleheads and im sure that PETA is to blame some way or another. PETA is to blame for everything going wrong in this world. Also we can blame the sierra club and any other save the whales type organization of misguided loodies.
Originally Posted By patrickegan <a href="http://mb.laughingplace.com/default.asp?WCI=MsgBoard&WCE=T-68013-P-1&Refresh=1009081729" target="_blank">http://mb.laughingplace.com/de fault.asp?WCI=MsgBoard&WCE=T-68013-P-1&Refresh=1009081729</a>
Originally Posted By gadzuux There's another issue (at least in california) which is under-noticed ... In the early 1990s, legislation was passed that required all stations to rip out their existing 'single hull' storage tanks and replace them with 'double hull' tanks. This cost about $150k per tank - in 1990s dollars. Many independents were forced out of business, while large corporate entities used the legislation to further their "vertical marketing". Whereas in the past, one company would pump the crude, another would refine it, a different company would market it. These days, about eight global companies control the vast majority of production, refining and distributing. It's not quite a monopoly, but rather an oligarchy of a few powerful conglomerates controlling the entire process. As a result, price fixing and corruption are all but guaranteed. I don't understand the people who point at environmental organizations as being somehow "the problem", while having total faith in corporate benevolence and integrity. All one has to do is to examine the motives of both to see which is actually more trustworthy.
Originally Posted By Kar2oonMan I don't understand the people who point at environmental organizations as being somehow "the problem", while having total faith in corporate benevolence and integrity.<< That's true. And when you look at the unbelievable profits the oil companies are enjoying, blaming instant price spikes to "supply problems" from Katrina, (even though the gas already at the stations at the time is the same that was there the days before the hurricane), integrity is what truly is in short supply from these companies. Talk about looting -- they loot the entire country.
Originally Posted By trekkeruss <<These days, about eight global companies control the vast majority of production, refining and distributing. It's not quite a monopoly, but rather an oligarchy of a few powerful conglomerates controlling the entire process. As a result, price fixing and corruption are all but guaranteed.>> This reminds me of DeBeers cartel, and how they have so effectively controlled the diamond market. Diamonds aren't nearly as rare or precious as they would have you believe, but they have brilliantly manipulated tha market into thinking they are.
Originally Posted By Disneyman55 Actually, I do not beleive at all in the benevolence of either man or corporations. Interestingly enough, I am confident that many of the people involved have good intentions, but...... The point of my post was not to just point a finger at enviromentalists (I actually have been contemplating joining the Sierra club....SHOCKING!), but to point out how inflexibility and emotional attachement to an idea can hinder practical solutions to many of our problems. Right, wrong or indifferent, the only way to drop the price of gas is to increase our refining capacity. This is simple economics. A practical solution between rational parties should be able to be reached. This is simple negotiating skills. But for some reason, this is not happening. Why? At this point, and from this article, it does look as if certain people are obstructing the increasing of our refining capacity. Oh, and Tom, I like the article you posted. Especially the last paragraph. Proves my point. Everybody has a point of view and a way of looking at things. But we should still be able to negotiate and compromise.
Originally Posted By TomSawyer >>Proves my point.<< But the report in it's entirety points out that refineries were closed and no new refineries were built largely due to the economics of refining, not because of environmentalism. It was cheaper to refine the oil elsewhere than it was to refine it here.
Originally Posted By TomSawyer John Hofmeister, the President and CEO of Shell Oil, said that we probably don't need to build any new refineries, and that even with the incentives in recent legislation Shell doesn't think investing in new US refineries is a good move. <a href="http://news.yahoo.com/s/krwashbureau/20051007/ts_krwashbureau/_energy;_ylt=AuIb2P_uysuqdlEH7tZ4wkVKeckF;_ylu=X3oDMTBiMW04NW9mBHNlYwMlJVRPUCUl" target="_blank">http://news.yahoo.com/s/krwash bureau/20051007/ts_krwashbureau/_energy;_ylt=AuIb2P_uysuqdlEH7tZ4wkVKeckF;_ylu=X3oDMTBiMW04NW9mBHNlYwMlJVRPUCUl</a> excerpt: U.S. government and international agencies forecast that global oil consumption will grow from today's 83.4 million barrels a day to 120 million barrels a day by 2025. Absent new or expanded refineries, America could become even more dependent on gasoline imports in an era when developed and developing nations across the globe also need more gasoline. But Hofmeister questions the long-term demand forecasts, pointing to the recent bout of record-high oil and gasoline prices that he feels may mark a turning point. The surge in popular SUVs came during the 1990s when oil prices were between $10 and $20. Now with oil seeming to fall within $40 to $60 a barrel for at least the next several years, consumers may demand automobiles that get better gas mileage. "That really shifts the attention of the automotive industry to look for more fuel-efficient alternatives," Hofmeister said. And that makes oil executives more cautious about plunking down billions on new refineries, which historically have provided lower rates of return than exploration and production of oil. It also calls into question efforts by Congress to make military bases and federal lands available to build new refineries. Hofmeister said that even with incentives, Shell isn't planning a new U.S. refinery. Shell prefers to expand existing refineries like its joint venture with the Saudi state oil company in Port Arthur, Texas. Asked if the emergency legislation proposed in Congress would bring about more refineries, the Shell executive answered with this question: "Does the energy legislation promote refining capacity increases predicated on current consumption patterns, or will the emergency legislation allow us to adjust refining capacity to changing consumption patterns?"
Originally Posted By trekkeruss <<that really shifts the attention of the automotive industry to look for more fuel-efficient alternatives>> The auto industry could easily make much more fuel efficient cars, but we are too selfish to want them, and are more interested in size and power. We may demand more fuel economy now, but once gas prices dropped, you can bet it'd be back to the old ways of wanting more horsepower and size.
Originally Posted By Kennesaw Tom Not true. Honda, Toyota and Nissan will have new models available in this country by the end of October that will get over 40 mpg. Ford annouced that they will have cars availabe in 2007 that will do the same. GM builds cars in Brazil that can run on either gas or ethanol but will not ship them to the US. Point being, these cars already exist. Some car manufatctors are bringing them here, others either will not or don't have the ability to respond that quickly to the market.
Originally Posted By peeaanuut <<(I actually have been contemplating joining the Sierra club....SHOCKING!)>> Think REAAALLLLYY hard about that one. <<The auto industry could easily make much more fuel efficient cars, but we are too selfish to want them, and are more interested in size and power. We may demand more fuel economy now, but once gas prices dropped, you can bet it'd be back to the old ways of wanting more horsepower and size.>> Actually your a bit off their. The consumer does NOT want to buy fuel efficient vehicles. Honda in particular is selling the Hybrid and Electric Civic and the Insight below production cost. They lose money on each sale in an attempt to entice the public to purchase them. They simply do not buy them. They run more for the Pilot and Ridgeline than the Insight or the Civic. The Prius from Toyota is the same way. They sell for less than their production price and the public simply does not buy them. VW has had a diesel bug for years and the US market does not want to purchase it. Diesel fuel is more efficient and burns cleaner than gasoline yes the market does not demand it. Major corporations are giving incentives to employees that purchase fuel effecient vehicles and the consumer still doesnt buy them. There is enough supply, there simply is no demand.
Originally Posted By trekkeruss ^^ Which is why I said "may" in my statement. Some people are reactionary, and are buying, or at least considering, the fuel efficiency of the vehicles they buy... this is borne out by the dip in SUV and truck sales of late. But overall, fuel economy is very low on the list of priorities for the vast majority of Americans. The auto industry has had the capability to make 40mpg cars for at least 20 years, but again, we don't want that... we want larger engines with more cylinders and more horsepower, and just plain big overall, period. We gawk and envy the guy with the Hummer, not the guy with the Hyundai.
Originally Posted By TomSawyer Toyota is coming out with a hybrid Highlander that has a 270hp engine that will get over 30 mpg, and 0-60 acceleration in under 8 seconds. That's the future.
Originally Posted By peeaanuut but that is rediculous. A hybrid engine in an SUV just makes no sense.That is not much over a gasoline vehicle now. The pilot gets 22 MPG and has a 245hp engine. With a not so much gain in gas mileage or horsepower, what is the point?
