Fewer Refineries=More Profit

[Weester]

While the Bush administration cites a lack of refineries for energy shortages, internal oil industry documents show that oil companies were looking for ways to cut refinery output to boost profits.

Internal documents from some of America's biggest oil companies suggest higher prices at the pump may, in part, be a result of a deliberate strategy to limit domestic gasoline production, reports CBS News Correspondent Bob Orr. Sen. Ron Wyden, D-Ore., who has been investigating oil prices for two years obtained the documents.

"These documents say point blank, look if you really want to boost your profits, you have to reduce refinery capacity," said Sen. Wyden. "This industry went to great lengths to limit refinery capacity, control markets, restrict supply to boost their profits, increase costs to consumers, and then argue we should relax environmental laws."

One Chevron memo warns the oil industry would never see higher profits, if it didn't reduce the amount of gasoline being refined.

"If the U.S. petroleum industry doesn't reduce its refining capacity, it will never see any substantial increase in refinery margins (profits)," said an internal Chevron document in November 1995.

The memo cited warnings given about refinery profits by a senior analyst from the American Petroleum Institute, the industry trade group, at an industry conference that year.

A year later, an official at Texaco, in a memo marked "highly confidential," called concerns about too much refinery capacty "the most critical factor" facing the refinery industry - resulting in "very poor refining financial results."

The Texaco memo, written in March, 1996, concluded that "significant events" were required to deal with the excess refinery capacity problem and suggested one solution might be to get the government to lift clean air requirements for an oxygenate in gasoline. Removal of the additive would require more gasoline to be used in each gallon of fuel, tightening supplies.

[henschman]

its a known fact that most economic regulations are advocated most forcefully by the very industries to be regulated. its a great way to put up entry barriers to possible future competitors and small startups that can't afford a staff of attorneys and lobbyists.

i'm telling you, if you want to get the money out of politics, just take away the government's power to regulate the market. when there is no money to be made by lobbying, companies will stop doing it and start putting that money back into productive uses like re-investment and wages, instead of having it go to the economically wasteful use of "rent-seeking." It's the same thing as having a tax code so complicated that it takes an entire new industry -- CPAs and tax attorneys -- to administer it. it is extremely economically wasteful to spend billions per year simply to comply with the law, just like it is economically wasteful to devote billions toward paying people to bribe politicians to make laws that will make you more money.

[UNGN]

Weester, those memos were written when oil was $15 barrell.

Could you find some quotes from THIS decade?

Oil companies would gladly build more refineries, now, if congress would let them.

[Weester]

Originally Posted by UNGN

Weester, those memos were written when oil was $15 barrell.

Could you find some quotes from THIS decade?

Oil companies would gladly build more refineries, now, if congress would let them.

Its still going on and nothing is being done to stop it!!!

How are they going to build more refineries when the states where they need to be built wont allow it? Why have they shut down many refineries that were already running???

[GrnNatlFan]

Originally Posted by Weester

Its still going on and nothing is being done to stop it!!!

How are they going to build more refineries when the states where they need to be built wont allow it?

How is that the oil companies fault?

Why have they shut down many refineries that were already running???

No new refineries in 30 years. How many 30 year old cars do you see running around? Comes a time when it costs more to maintain than its worth.

[Weester]

"How is that the oil companies fault?"

Re-read the post........................DOH!


Who do you think owns the refineries????

Here are a few hints:


ExxonMobil Baytown, TX, USA

ExxonMobil Baton Rouge, USA

BP Texas City Texas City, TX, USA

Citgo Lake Charles Lake Charles, LA, USA 425,000

BP Whiting Refinery Whiting IN, USA

ExxonMobil Beaumont TX, USA

Sunoco Philadelphia, PA, USA

ConocoPhillips Wood River IL, USA

[GrnNatlFan]

Originally Posted by Weester

"How is that the oil companies fault?"

Re-read the post........................DOH!


Who do you think owns the refineries????

Here are a few hints:


ExxonMobil Baytown, TX, USA

ExxonMobil Baton Rouge, USA

BP Texas City Texas City, TX, USA

Citgo Lake Charles Lake Charles, LA, USA 425,000

BP Whiting Refinery Whiting IN, USA

ExxonMobil Beaumont TX, USA

Sunoco Philadelphia, PA, USA

ConocoPhillips Wood River IL, USA

Your direct quote from post #4:

"How are they going to build more refineries when the states where they need to be built wont allow it?"

Your quote says to me its the states fault that the oil refineries can't be built within the states? Again, how is this the oil companies fault?

[Weester]

Its a combination of both!!!

Who stands to make a huge profit if we cant increase our output? or should I say, WHO IS MAKING A HUGE PROFIT?

The oil companies would rather ship the crude overseas for processing, more profit for them!!

[GrnNatlFan]

Originally Posted by Weester

Its a combination of both!!!

Who stands to make a huge profit if we cant increase our output? or should I say, WHO IS MAKING A HUGE PROFIT?

The oil companies would rather ship the crude overseas for processing, more profit for them!!

The state and Federal govt is making the huge profit! No costs associated with their revenue!

[Carr]

Originally Posted by Weester

Its a combination of both!!!

Who stands to make a huge profit if we cant increase our output? or should I say, WHO IS MAKING A HUGE PROFIT?

The oil companies would rather ship the crude overseas for processing, more profit for them!!

the oil companies profit margin is 7% which is an okay to average profit margin for most business. so not huge profit. if you want more oil, tell your democrat congress to get out of the way, and let them drill.

[Weester]

"the oil companies profit margin is 7% which is an okay to average profit margin for most business. so not huge profit. if you want more oil, tell your democrat congress to get out of the way, and let them drill."

You have bought into the "red herring" story!!! Drilling wont drop the price of gas!! The techniques required to get the oil are EXPENSIVE, not like pulling the oil from the ground in the middle east! Oil will have to remain higher than 100 a barrel to make it cost effective. Get used to paying 4 bucks a gallon and get ready for 5.00+ a gallon!

Take a look at the profit margin for the refineries!

[Carr]

you need to stop looking at anti big oil propaganda.

[BLACK6PACK]

Originally Posted by Carr

you need to stop looking at anti big oil propaganda.

+1

yeah, he says you're blinded by oil companies' propaganda, but he's the one that can't see that every time they threaten to drill the price of oil drops. A lot of oil can be had for cheap. Even the expensive shale oil is $50-75 a barrel, which is half what it is now. The oil companies don't set the price of oil. They'd be making about the same amount of money if oil was at $50 barrel and selling for $2 a gallon gas. Reason for the huge profit is that they are producing a LOT of product at a 7% profit.

I sell 100 widgets a month for $107 each. That's $700 a month profit. Now lets say that everyone that owns a car has to buy 4 widgets a month. I'm now selling 1,000,000,000 a year and bringing in $7,000,000,000 a year in profit. Did I change my model? No, all I did was do a huge amount of business. Also it costs me millions a year in R&D.

[ekafrawy]

Some oil companies are trying to build new refineries. Including BP. But some environmentalists are trying to stop that.
Lawsuit challenges BP Lake Michigan oil refinery plan -


And most of you know probably already know this, but farmers in S. Dakota are trying to block a new refinery from being built.

Farmers fight plans for new oil refinery - CNN.com

So I can't see all the blame going to these oil companies, only some of it.

[IEATV8S]

Originally Posted by Weester

Its still going on and nothing is being done to stop it!!!

How are they going to build more refineries when the states where they need to be built wont allow it? Why have they shut down many refineries that were already running???

Don't you liberals EVER FACTCHECK your lies???

NEW YORK, July 23 (Reuters) - U.S. gasoline stocks rose 2.9 million barrels, exceeding analysts expectations, while crude stocks declined by 1.6 million barrels, more than double analysts' expectations, the U.S. government reported Wednesday.

The rise in gasoline stocks came despite a large drop in refinery capacity utilization. U.S. refineries operated at 87.1 percent of capacity, 2.4 percentage points lower than the prior week, the Energy Information Administration reported.

End of Liberals BS again! They have to be the dumbest group of sub-humans on the planet! The very sad part is, they TRY to make everyone believe their BS! That's why everything they put out should be checked for accuracy, and factual content!

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