Posted on 08/21/2026 10:34:21 AM PDT by MikelTackNailer
Energy Secretary Chris Wright met with executives from refining companies on Monday to explore ways the Trump administration could help them boost throughput volumes to help keep America’s gasoline and diesel market fully supplied. The meeting took place in Midland, Texas during an industry conference Wright was attending.
Wright and the White House believe an increase in refined volumes could hold the key to lowering prices for gas and diesel at the pump. The administration’s concerns are not surprising given the fact that gasoline prices have stubbornly remained above $4.00/ gallon nationwide amid the ongoing Iran Conflict, a dollar higher than a year ago. Though still a dollar below the highs reached during the Biden autopen years, the current price paradigm could have a significant impact on November’s midterm elections.
Wright told reporters that the Department of Energy (DOE) would announce steps later this week it can take to help spur higher throughput even though his own Energy Information Administration reported last week that U.S. refineries have been sustaining unusually high activity levels for months now. Some companies have expressed concerns in recent weeks that the current 96.2% capacity level cannot be sustained for much longer as some refineries are already well past their regular periodic maintenance downtime schedules.
It’s hard to see how the feds can spur even higher output levels through this limited refining fleet. Secretary Wright will be looking for short-term measures, like possibly suspending fuel blending requirements under the Environmental Protection Agency’s (EPA) haze reduction program. That move would have made even better sense to take in April when refiners are annually forced to switch over to costly summer blends that always raise gas prices at the pump just as summer driving season ramps up.
The real enduring problem related to America’s refining industry is that there isn’t enough of it: The U.S. industry hasn’t opened a single new major refinery in almost half a century now. The simple fact is that the United States needs more refineries if it is to keep more of its record, world-leading oil production at home for domestic use instead of having to export three million to five million barrels of the light, sweet crude produced from the Permian Basin every day because there isn’t enough domestic refining capacity to handle it.
A single new greenfield refinery is under construction today by America First Refining at the Port of Brownsville, Texas. Scheduled for completion in late 2027, the America First Refinery will have an initial capacity to process up to 168,000 barrels of light, sweet crude per day. As substantial as that is, it puts only a small dent in the overall magnitude of the capacity shortage.
Make no mistake about it, building new refineries is not remotely a short-term solution. In an interview in March, AFR CEO John Calce told me just obtaining the mandatory air quality permit under the Clean Air Act consumed a full seven years for a facility that will take less than 3 years to construct. That’s a regulatory roadblock which has discouraged many other potential refinery projects since 1979.
Wright’s push also comes amid a trend among big shale producers to trim back on drilling budgets in favor of allocating capital to stock buybacks and other returns to investors. That also is not surprising given that it has been the prevailing operational model for shale producers since at least 2019, as Irina Slav points out in a story at Oilprice.com.
No one should doubt Wright’s contention during a Monday interview that the Permian Basin and other shale basins are capable of further increasing production of both oil and natural gas. The main variable in that equation is the willingness of the companies doing most of the drilling to allocate capital to meet that goal.
Most big oil-producing countries source most of their oil through a national oil company like Saudi Arabia’s Aramco that is responsive to government edicts and needs. But in the United States, oil and gas are drilled, produced, and refined by hundreds of privately held companies executing on their own discreet business plans.
Thus, persuasive though Mr. Wright certainly is, persuasion is really the only tool he and the White House possess to wring more throughput out of America’s already stressed refining industry.
Calling Captain Obvious, pick up the white courtesy phone...
“stockholders puts their short-term gains above what’s best for the industry and the nation.”
Every time and if you complain you’re anti-capitalist.
Doh! Why didn’t i think of that? 🤔
Won’t be discussed in California - where two refineries are being - or have been closed:
“Phillips 66 and Valero are closing two major California refineries, eliminating approximately 17-20% of the state’s total refining capacity.”
And:
“As of 2026, California has 11 operating oil refineries, a significant decline from 13 in early 2025 and 40 in the 1980s.”
No wonder gas is $5.49/gallon as of this morning in So Cal.
The problem is that the boards are now controlled by the 'international bankers' stock traders out for short term gains, instead of investors with a long horizon.
But the immediate problem is caused by oil companies having to close refineries due to anti-oil laws and policies in California.
“stockholders puts their short-term gains above what’s best for the industry and the nation.”
Every time and if you complain you’re anti-capitalist.
——————————————
Without incentives, that is usually the case. The primary purpose of corporate leadership is to enhance stockholder value. Unfortunately, some executive compensation plans run counter to that goal.
What is the purpose of building more refineries if the refined products are simply shipped overseas for the highest profit? We need incentives so the United States benefits more by keeping petroleum-based products priced at an advantage for U.S. businesses and individual consumers. We could also require that a percentage of overseas oil be sold at a discount to the U.S. to refill the Strategic Petroleum Reserve.
For your perusal. President Trump’s got to ditch appeals to their humanity and get out-dated regulations cut to reinvigorate our fuel industry. What the article didn’t address is how we’re set up to process our own heavy crude without the means to process other grades.
As these massive plants take years to get online it’s imperative that they get moving before the Democrats manage it as well as they have California’s high speed rail project.
Democrats and NIMBYs will never allow another refinery to be built in the US again EVER!
...AND more insane asylums.
More Refineries = Higher efficiency = Lower prices.
I worked in the board room of a publicly traded bank. (I was a back bencher, but my eyes were opened.). The pressure from Wall Street to “hit the analysts numbers” is insane. And the analysts don’t always know your business as well as you.
If you don’t hit your numbers they will tank your stock price. That kills your bonuses AND it opens the company up to take-overs/sales. It’s more high stress than most people can imagine.
So, yeah…all publicly traded companies care about the next report. It is rare to be able to “manage the street.”
I have some “radical” ideas of why this happens, but the reality is that millions of people have handed their life savings over to fund managers who only care about beating the S&P this year. In the olden days, that was limited to a much smaller group of pension managers who understood the business world.
None of this is going to change any time soon.
Yes, the number of refineries is like the number of nuclear power stations. We could use more but most people don’t like them in their back yard. That being said California is closing theirs. So others could pick up the slack and charge California top dollar for the gas. Remember though, refineries make plastic, jet fuel, asphalt, diesel as well as gas. And you likely need to have the refinery in Nevada.
Why should a business do anything other then seek itself interests?
If we want more refineries for the good of the country, the feds need to incentivize it or own it.
I propose that we sacrifice 1,000,000 leftists to the refinery gods for each new refinery that we are granted.
We get a refineries by flushing refuse.
I am surprised that there is not been a national emergency declared with domestic oil production and refining capabilities. Perhaps use some of the closed military faces to allow for new refineries and production free from interference
Finally there is some attention given to the idea that certain manufacturing, energy, petroleum oil and lubricants, rare earth minerals, certain key enabling technologies are a national security issues.
To Ted Cruz’s credit, he was one of the few in Congress that was pressing the alarm button over a decade ago: (an example from 6 years ago) https://www.reuters.com/article/business/aiming-to-thwart-china-us-senator-pushes-rare-earths-funding-bill-idUSKBN22P0C7/
Trade is great. Not saying that tongue in cheek. Economy of scale and greater specialization creates more wealth for all involved.
—But trade needs to be fair, not lop sides to where US manufacturing is bled to death as China industrializes (early on) at our expense.
—Also this trade CANNOT allow certain key technologies and manufacturing capacities, energy, petroleum, oil, lubricants, and key minerals, to go lost ESPECIALLY to a nation that is hostile to us.
Real world case: The US imports 80% of rare earth minerals we use. 70% of those imported come from China. Rare earth is used in advanced batteries, lasers (even for defense), semi conductors and other electronics, magnets and advanced electric motors... Even fiber optic wire has rare earth used in it’s manufacture. https://econofact.org/can-the-u-s-reduce-its-reliance-on-imported-rare-earth-elements Being dependent on something that critical, from someone hostile towards you, isn’t smart.
All our MSM does is peddle off pro Democrat trash, they do not report and their analysis isn’t worth shit. Can you imagine what would have happened if we had been in a conflict with Iran like today but in 2012? https://wolfstreet.com/wp-content/uploads/2026/03/us-crude-oil-03-03-2026-imports-OPEC-Saudi-Russia.png Instead of exporting oil and in net easing some of the pressure from Hormuz like today, we would have been ourselves dependent on this oil!!! Disaster-
You have part of it backwards: The purpose of building more refineries is to significantly increase global supply of refined products, driving the price down while making the USA a lot of money.
It is true new refineries could be built to more efficiently process our light shale oil, but it is also important to remember that refined products includes huge quantities of products other than fuel for vehicles. Shale oil isn’t so great if you need, say, asphalt. Pushing hard to get heavy crude production up, from Venezuela, is a very very important part of all this.
In fact, IF it looks like Venezuela can be kept stable, even refineries in Venezuela, which might be a faster route to getting production from heavy crude increased quickly, due to (I would assume) less environmental regs’ hurdles, could be a win both for Venezuela and us: Income for them, and lower global prices for refined products, overall. This helps counter interruptions elsewhere, such as the rather impressive collection of attacks the Ukies are whacking the Russians with now, or the nasty problems with terrorist Iran and their terrorist proxies.
So long as we want to keep this a (mostly) free market, the goal should be to increase global supply to keep global refined products prices down. The more we can do it here, the better, but all viable options should be pressed. That also gives us some room to maneuver when it comes to geo-political concerns, such as “taking care of business” with Iran.
Sadly, that’s true.
Good points. On this, we are in close agreement.
I wonder what that oil imports graph looks like for countries like France, the UK, and Germany...
I suppose Venezuela is included in OPEC in that graph, but, effectively...
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