Skip to comments.
Gas Price Surge Under Bush Follows Unchecked Increase in Refinery Mergers
Bloomberg News ^
| 5/17/04
| Jim Efstathiou Jr.
Posted on 05/17/2004 5:34:34 AM PDT by machman
Edited on 07/19/2004 2:14:12 PM PDT by Jim Robinson.
[history]
May 17 (Bloomberg) -- President George W. Bush allowed an increase in oil refinery mergers to go unchecked since he took office and may have contributed to the highest gasoline prices in 20 years as the November election approaches.
The Bush administration approved 33 takeovers totaling $19.5 billion, on top of 21 deals worth $7.3 billion under President Bill Clinton, Bloomberg data shows. Reduced supplies were already pushing up gas prices in Clinton's term, according to a Federal Trade Commission study conducted after pump prices rose to more than $2 a gallon in Milwaukee and Chicago in 2000.
(Excerpt) Read more at bloomberg.com ...
TOPICS: Business/Economy; Culture/Society; Foreign Affairs; Front Page News; Government; News/Current Events; Politics/Elections; US: Alaska; US: California; US: Louisiana; US: New York; US: Texas
KEYWORDS: doomberg; energy; environment; gasoline; gasprices; gloomdoomberg; gwb; oil; refining; texas
Navigation: use the links below to view more comments.
first previous 1-20, 21-40, 41-60, 61-67 next last
To: machman
21
posted on
05/17/2004 6:38:00 AM PDT
by
AxelPaulsenJr
(Excellence In Posting Since 1999)
To: Brilliant
Wrong, it's a combination of the two.
The real question is, how many refineries have been closed or downed for an unusually long period of time as a result of the mergers?
22
posted on
05/17/2004 6:46:41 AM PDT
by
Bikers4Bush
(Flood waters rising, heading for more conservative ground. Vote for conservatives!)
To: tob2
Regardless of who is responsible for the rise in gas prices, the auto manufacturers need to use improved technology so that cars can run efficiently on renewable sources of energy. You want a wood burning car?
So9
23
posted on
05/17/2004 6:50:39 AM PDT
by
Servant of the 9
(Screwing the Inscrutable or is it Scruting the Inscrewable?)
To: Rodney King
I saw another article (it might have been on FR yesterday) which talked about the marginal effect of an oil price change on gasoline prices. It looked like the way to calculate the "oil cost" in gasoline is to take the per barrel price and divide by 43.
The the quoted price of $41.38 a barrel means that the oil costs 96.2 cents/gallon of gas. Then add taxes (42 cents/gal in Ohio), shipping expenses, refinery expenses and station expenses.
24
posted on
05/17/2004 6:57:44 AM PDT
by
KarlInOhio
(Teach a Democrat to fish and he will curse you for not just giving him the fish.)
To: machman
Between 1977 and 2002...U.S. demand for gasoline has grown 27 percent
European gasoline prices are at their highest recorded levels due to demand from the U.S
Demand from Asia has boosted the price of crude oil
World oil demand is rising at its fastest rate since 1988
Gasoline prices have to get well above current levels to think we would see a substantive and mature impact on the economy So you can expect gas prices to rise well above their current levels in the next year...says Liberallarry, 66.
To: machman
[A 'registered Republican' said]``The average guy on the street is getting killed because this administration does not care.'' Only an idiot (or a Democrat Party hack, whether you call yourself a "Republican" or not) would think this: the administration has consistently advocated greater exploration and extraction of our own oil resources in order to keep us from being oil-dependent.
Additonally, the merging of refinery companies proves nothing.
Our increase in oil is due to the increased demand from Asia, China particularly, and due to an inability to refine the crude...OPEC could help by increasing production, but if you don't have the ability to refine the stuff, it won't make a huge difference.
No new refineries have been built in the USA in at least, what, 10 years? That is a huge problem...
I am amazed how fast some people are to point fingers at the current administration. :) Some simple, simple economic lessons are in order for a lot of people. I am hopeful, though: I think more people are "getting it" when it comes to some of these basic economic facts.
26
posted on
05/17/2004 7:03:01 AM PDT
by
Recovering_Democrat
(I'm so glad to no longer be associated with the Party of Dependence on Government!)
To: machman
That Bush!
Is there nothing bad that he cannot do?
27
posted on
05/17/2004 7:03:40 AM PDT
by
dead
(I've got my eye out for Mullah Omar.)
To: machman
Actually it is really Abe Lincoln's fault. Hey anyone knows that!
28
posted on
05/17/2004 7:09:11 AM PDT
by
jmaroneps37
( Kerry's not "one of us": catholicagainstkerry.com. needs your help.)
To: umgud
Bingo! That is exactly the reason for most of the increases. Since the mandate of "designer gasolines", it's much more expensive to refine gasoline due to the constantly changing formulas, which means the refinery can't run a continuous process. It's also more expensive to ship since the "designer formulas" can't be mixed, they have to move by truck rather than pipeline, and shortages in one area can't be covered by surpluses in another due to the different formulas.
29
posted on
05/17/2004 7:23:52 AM PDT
by
anoldafvet
(Another Vietnam Vet against John f'n Kerry)
To: Brilliant
The article says prices are up 30% and the avg price per gallon is 1.94??? Well prices are averaging closer to 2.20 a gallon in Washington state. This had better stop and reverse itself, or Bush will lose the election. It is as simple as that. People will vote on their pocketbooks.
30
posted on
05/17/2004 7:29:10 AM PDT
by
jeremiah
(Sunshine scares all of them, for they all are cockaroaches)
To: River_Wrangler; KarlInOhio
There are only 42 gallons of oil in a Barrel of crude, ergo each incremental $1.00 rise in crude adds $0.023 to each gallon of gasoline. You can't get 42 gallons of gasoline from a barrel of oil. It's more like 19 gallons of gasoline, the rest being converted into other petrochemicals and asphalt.
31
posted on
05/17/2004 7:29:20 AM PDT
by
Dog Gone
To: machman
Mergers? Hell yes!
8 Years of a democrat/enviromental adminstration where the business enviromnet was so hostile not one new refinery has been built in the last 10 yrs!
To: machman
Good catch machman
Something not mentioned, or really understood, is not all the oil in a barrel of oil goes for gasoline. If I remember right, it's only about ten percent of the oil in the barrel is suitable for gasoline production. That means, consumers should be aware of other prices rising as well. Such things as plastics, denim and anything that uses oil in the product.
To: machman
ConocoPhillips, which produces a sixth of the nation's gasoline, said its plants are operating at 97 percent of capacity. No new refineries have been built in the U.S. since 1976 because of the difficulty in getting approval to build plants and the cost of construction, said Drevna of the National Petrochemical & Refiners Association. Looks like a straight demand and supply issue demand is up supply unchanged. What happened in 1976 that resulted in no more refineries being built?
Folks this will get much worse. If refineries are opeating at 97% capacity that means that not much preventative maintenace is goin on. Look for major refinery outages.
To: River_Wrangler
You are right. To expand on your number three. Until Bush, as Govenor of Texas gave them a waiver refineries couldn't implement upgrades unless they brought them up to 100% EPA standards, so a 70% improvement was sacrificed because it was not cost effective to pay for the 100% improvement. If Bush hadn't granted waivers to the Texas refineries the supply situation would be even more critical than it is today.
As an earlier post explained we have not built a new refinery for 27 years, ROI is lousy, NIMBYs prevent any increase in existing capacity. Added to the fact that we are not building enough electricity generating capacity and our natural gas supply is about to go critical, we are headed for an energy supply crunch in the not too distant future.
35
posted on
05/17/2004 7:38:46 AM PDT
by
Timocrat
(I Emanate on your Auras and Penumbras Mr Blackmun)
To: machman
B S, the refinery mergers took place under the Clinton administration, not Bush.
36
posted on
05/17/2004 7:40:55 AM PDT
by
Eva
To: Dog Gone
Refineries are a lousy business. Most of the time they register a profit of 5 cents or less per gallon, and there have been years when they actually lose money on each gallon. Seems I recall a news story that equated the current average national retail price ($1.82, as of last week) with the average national retail price in 1954 ($.27), adjusted for inflation.
However, given the even greater disparity in state & federal taxes, my guess is that, adjusted for inflation, the price of gasoline at the pump (ex. tax) has actually dropped over the past fifty years.
Accordingly, I find it very difficult to demonize the oil companies, in particular, and capitalism, in general, for rising prices.
37
posted on
05/17/2004 7:52:29 AM PDT
by
okie01
(www.ArmorforCongress.com...because Congress isn't for the morally halt and the mentally lame.)
To: machman
"Americans are paying 30 percent more for regular gasoline than a year ago...
The rise in gasoline prices helped refiners generate the highest margins from refining crude oil into gasoline and other fuels in the first quarter since at least 1990. ConocoPhillips, the largest U.S. oil refiner, last month posted its biggest quarterly profit since the 2002 acquisition that formed the company. ChevronTexaco Corp., the second-biggest U.S. oil producer, said earnings rose 33 percent to the highest level since a 2001 merger formed the company. Chevron's first-quarter refining profit doubled.
Exxon Mobil Corp., the second-largest U.S. refiner, on April 29 reported its highest first-quarter refining earnings in 13 years. Valero Energy Corp., the No. 3 U.S. refiner, said on April 28 that profit will almost triple in the current quarter after increased demand for gasoline spurred a 46 percent earnings gain in this year's first three months."
For all who think crude prices are the reason pump prices are so high, follow the money.
38
posted on
05/17/2004 8:02:25 AM PDT
by
azhenfud
("He who is always looking up seldom finds others' lost change...")
To: River_Wrangler
"If this is true...5)And way down the list, Crude prices. excellent points.. :)
39
posted on
05/17/2004 8:02:48 AM PDT
by
skinkinthegrass
(Just because you're paranoid, doesn't mean they aren't out to get you :)
To: KarlInOhio
the marginal effect of an oil price change on gasoline prices...The the quoted price of $41.38 a barrel means that the oil costs 96.2 cents/gallon of gas.Uh, that is not a marginal effect calculation.
40
posted on
05/17/2004 8:31:10 AM PDT
by
edsheppa
Navigation: use the links below to view more comments.
first previous 1-20, 21-40, 41-60, 61-67 next last
Disclaimer:
Opinions posted on Free Republic are those of the individual
posters and do not necessarily represent the opinion of Free Republic or its
management. All materials posted herein are protected by copyright law and the
exemption for fair use of copyrighted works.
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson