[Ophiucus]

While the article addresses crude oil production problems, it fails to address the refining problem. How long has it been since the government allowed a new refinery to be built, or existing refineries to upgrade to more efficient methods, or how many different 'anti-pollution' blends are they required to produce radically eliminating any efficiency at producing refined product at all?

Even at current crude prices, how low would a gallon of gas be if refining capacity was free market driven?

[PSYCHO-FREEP]

All of our existing refineries have made major upgrades and taken steps to increase output. This is why there was a sudden “unexplained” spike in prices last summer. We were at about 75% of our production capability because several major refineries shut down for repairs and modification. Two were retooled to meet Federal mandates for blended fuels.

The biggest reason there have been no new refineries built, is the extreme cost to build them in this day and age. The Oil companies operate at such a small profit margin, (8-10%) there simply is not enough money for them to do it and also meet their exploration goals. (Both of which are paid for by profits.)