Beat me to it. The regulatory walls in the US need to be broken down so new refineries can be built.
US firms ought to build refineries along the Mexican border and pipe directly to US.
Best National Security Move we could make, bar NONE!!!
North America to Drown in Oil as Mexico Ends Monopoly
By Joe Carroll and Bradley Olson December 16, 2013
The flood of North American crude oil is set to become a deluge as Mexico dismantles a 75-year-old barrier to foreign investment in its oil fields.
Plagued by almost a decade of slumping output that has degraded Mexico’s take from a $100-a-barrel oil market, President Enrique Pena Nieto is seeking an end to the state monopoly over one of the biggest crude resources in the Western Hemisphere. The doubling in Mexican oil output that Citigroup Inc. said may result from inviting international explorers to drill would be equivalent to adding another Nigeria to world supply, or about 2.5 million barrels a day.
Refinery capacity in the toilet.
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Yeah the story for 20 years or so has been that the US has not added any refineries since the 1970’s-80’s.
What no one has mentioned has been that the refiners have done for decades is just add capacity to the refineries they already have—because adding capacity is much much cheaper than creating a whole new refinery from scratch.
The bottleneck now is that most of the refineries are set up for sour crude from places like venezuela. However, most of the crude coming from the baaken eagle ford, the permian basin and everywhere else is light sweet crude.
The refiners won’t build new refineries to refine the light sweet crude. Rather what they’re doing is retooling existing refineries. Because its much cheaper to do it that way.
Right now the big bottleneck is in transporting oil. There isn’t the pipeline infrastructure to handle the new oil so its being moved my rail. That adds an extra 10-12 dollars a barrel to the price of oil. But in places like the baaken, the price of oil at the well head is only about 74 dollars a barrel— so its still cost effective to ship the oil by rail to the east & west coast refineries.