Posted on 08/25/2015 9:42:36 AM PDT by bestintxas
Do you think they would have an easier time building multiple refined products pipelines after the ongoing problem with Keystone XL?
Another problem is to be economically competitive with the US modern refineries, you have to recognize more than oil goes in and more than gasoline and diesel goes out.
Many major refineries in the Gulf Coast Region get hydrogen from the area hydrogen pipeline that does not exist. We have more petrochem plants in the area than we do refineries. And we have refineries that want their heavy oil.
Since we already refine more than we use, adding additional refinery capacity has to be competitive with shipping product internationally. Right this moment margins are high, but over the life of a refinery they are typically quite tight.
I think having the problem at the peak of driving season, combined with the multiple blend requirements are the real problem.
Gasoline use climbed more this summer than has in recent past.
And the expectation that companies build additional capacity that they don’t normally use is unrealistic. Who wants to spend billions of dollars unless that unit is running 24/7?
Well it all comes down to economics.
Obviously when BP Whiting is down they don’t make any money.
You could take a 10 year view of downtime and calculate if it would make sense to have backup capacity.
Do you really believe that companies building these facilities don't do that? Major refinery expansions typically involve 10 years of work before new product moves. I know that last major BP Whiting expansion did because I was part of it.
It seems like a huge airplane with one engine.
No redundancy.
I know a guy who works up there as an electrician and they’re always having downtime.
It is a huge airplane with 140 engines.
Normally, all of them run.
When enough are not running, the efficiency goes down. Like the midwest refinery process today.
But I don’t see gas stations closed up for lack of product to sell today.
It cost money to move product from other areas. It cost money to make special blends from refineries and terminals that don’t normally supply that product to that location.
But they can and do. They just don’t do it for free.
Why there is a lag in gas prices on the way down and not on the way up. Lots of big picture factors, but right at the gas station level this is what happens. The gas station buys a “tank” load. If the price of gas goes down, they still have to sell at the higher price or loose money on the previous tank load. That tank load can be a day or a month supply based on the traffic. On the way up: If the price of gas goes up, the station has to raise prices right away in order to be able to buy the next tank load at the new price. An to exacerbate the above, many are contracted well into the future.
Exactly. When oil goes up you see it at the pump that very afternoon. They are so full of s***!
illinois, as you note, has 4 different epa zones ... times three blend levels (regular, midgrade, and premium) ... times two seasonal changes (summer/winter) = 24 different formulation requirements for just one state over the course of a year ... what a cluster***k ... obamastan, indeed
Have you ever noticed that every time gas prices go down there is a fire or explosion at a refinery. The next day prices rise a dollar a gallon.(Figuratively speaking.) Our society from top to bottom is being run by aliens, frauds, criminals and Mountebanks.)
someone is siphoning off the profits - oil companies or government - who is guilty? Gas at the pump should $2 and under right now!!
The explanation I have heard from an Austrian economist (I forget who it was):
When oil prices rise, the gas station owner raises prices (as high and as fast as his local market will support), because the next load of fuel he buys will be priced based on the higher price of crude (plus refining and delivery costs).
When oil prices drop, no station owner wants to be first to cut his price, making the higher price a little sticky. Eventually, though, someone in the local market drops their price, and the others follow suit to avoid loss of sales.
Look at the bright side...the more expensive the gas, the less poor people clogging up the roads.
(I can see a noticeable difference in traffic from a year ago)
EPA (fascists)
50+ blends
Regulation ad nauseum
A congress populated by demagogues, idiots, morons and corrupt socialists
A country where 40%+ of the population “worships” Mother Earth.
More prime fodder for demagoguery from Bernie Sanders and the Fake Indian.
We need new refineries.
We need to cut the gas tax.
We need a low barrel price for a while, so it’s sustained enough to convince oil companies that they can lower the price and make a profit.
We need to deregulate. But that’s pretty much true of everything.
I live in a relatively small town, maybe 12 gas stations in a 6 mile radius. When gas goes up, EVERY one of those stations goes up the same amount within 1 hour of each other. With the rare occasional exception. The down move is a little slower, not too much though. Usually a day or two to reach parity.
When Obama took office, the average price was $1.83. It’s still higher than that.
They will get their money to ride out the oil fall.
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