No comment.
You can't put crude oil in your gas tank. The problem is refineries are down. This may cool the vultures in the commodities trading pit for a day or two, but it won't have much effect on the pump price. Every driver in the country needs to find ways to cut back on fuel use. That would help stretch supplies.
Taxpayers paid ~$27.50 a barrel, I hope the selling price to the refiners is the going rate: $70.00 a barrel....
There is however a huge money net between the American consumer and the oil companies.
Plenty of oil in the Middle East, Canada, Alaska, Mexico, Venezuela.
Doesn't anybody wonder why this country has less than five major oil refineries?
HINT: Limit product availability, raise prices, perpetually gouge the consumer and cash in at the bank.
reporters asking about national price cap. Whitehouse spokesman says no real push for this but will not allow price gouging. Instances will be referred to FTC. Problem is not only the Souths but is whole country's
SEc of Energy.....says no to price caps.
Bush taking proper steps.
Weren't they already saying they were gonna do this before the hurricane?
Maybe I'm being too simplistic, but why don't they build refineries in the Free Trade area of Mexico. They have the crude, no EPA, no NIMBY and a huge market in California.
It seems like an easy solution. Am I wrong?
Excellent decision.
The main excuse you hear time and again is that this country does not have the refining capacity. And you will hear time and again that oil companies are not willing to build billion dollar refineries - YET their profits are up 30% to 40% over the last two years? What's up with that? Are they waiting for the taxpayers to build them?
I do not agree with this call...
The reserves were not intended to be used to ease the cost of gasoline to the public...
Releasing any amount (from the strategic reserves) will not do anything to make that cost go any lower for any of us...
It is rather funny that when the thought originally came to the front page of the news radar late last week...That the story (they are using now), is that the release of a portion of our strategic reserve is to make up for the loss of incoming barrels from domestic drilling operations, which have obviously been hampered by the storm...
Like I have said before, something else is amiss...
I have never seen "inflation" drive a mass-use commodity like oil/gasoline, to be inflated over 200% in a 24 month period...
They key to all of this is that we can no longer "refine" the oil to gasoline products as fast as we are taking in the oil...
We got all the oil we need coming in...Its the refining of that product to what we can use that is driving up the cost...
When you have accidents (natural or mechanical) that reduce that refining potion of the process, thats what hurt the majority of us...
Remember we have not been able to build ANY new refineries in years...Thanks to the eco-freaks, and their successful efforts...
Thanks to them and the weak-kneed government, we ar now paying the price...
Expansion of existing refineries has been minimal, if not just upgrades to those facitities, no increases of refining of the oil, means a "cap" on what gets to the pumps around the corner from you...
I expect to see $3.00 per gallon of gas within the next month...
And it will not get any better till we expand the refining capability in this country...
Yeah, getting our oil from ANWR will help us eventually, but getting that supply to us to do any good to reduce the cost of this commodity will take at least a minimum of 5-8 years...
Bottom line...I think we should leave the reserves alone...We can tough this out...
The Strategic Petroleum Reserve (SPR) is an emergency petroleum store maintained by the United States Department of Energy. It is the largest emergency supply in the world with the capacity to hold up to 727 million barrels (116 million m³) of crude oil.
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The reserve is stored at four sites on the Gulf of Mexico, each located near a major center of petrochemical refining and processing. Each site contains a number of artificial caverns created in salt domes below the surface. (Note: Capacity numbers may be out of date.)
Individual caverns within a site can be up to 1000 m below the surface, average dimensions are 60 m wide and 600 m deep, and capacity ranges from 6 to 30 million barrels (1 to 5 million m³). Almost $4 billion was spent on the facilities. The decision to store in caverns was taken to reduce costs; the Dept. of Energy claims it is roughly 10 times cheaper to store oil below surface with the added advantages of no leaks and a constant natural churn of the oil due to a temperature gradient in the caverns. The caverns were created by drilling down and then dissolving the salt with water.
A fifth site, Weeks Island in Iberia Parish, Louisiana, had a capacity of 72 million barrels (11,000,000 m²), but was decommissioned in 1999. Unlike the other facilities, the Weeks Island caverns were a conventional near-surface salt mine, formerly owned by Morton Salt. In 1993, a sinkhole formed on the site, allowing fresh water to intrude into the caverns.
Because of the caverns' construction in salt deposits, fresh water would erode the walls, potentially causing the structure to fail. The caverns were backfilled with salt-saturated brine. This process which allowed for recovery of 98% of the petroleum stored in the facility, reduced the risk of further freshwater intrusion, and helped prevent the remaining oil from leaking into the aquifer that is located over the salt dome.
Access to the reserve is determined by the conditions written into the 1975 Energy Policy and Conservation Act (EPCA), primarily to counter a severe supply interruption. The maximum removal rate, by physical constraints, is 4.3 million barrels per day (8 m³/s). Oil could begin entering the marketplace 13 days after a Presidential order. The Dept. of Energy says that it has about 7 to 8 weeks worth of inventory protection in the SPR. This, combined with private sector inventory protection, is estimated to total 150 days worth of emergency supply.
The SPR was created following the 1973 energy crisis. The EPCA of December 22, 1975, made it policy for the U.S. to establish a billion barrel (159 million m³) reserve. A number of existing storage sites were acquired in 1977. Construction of the first surface facilities began in June 1977. On July 21, 1977, the first oil—approximately 412,000 barrels (66,000 m³) of Saudi Arabian light crude—was delivered to the SPR. Fill was suspended in FY 1995 to devote budget resources to refurbishing the SPR equipment and extending the life of the complex. The current SPR sites are expected to be usable until around 2025. Fill was resumed in 1999.
Oil has been removed under emergency conditions only once, in 1991. However, oil has been temporarily loaned out or exchanged to private oil companies in a few circumstances. These include an ARCO pipeline disruption in April 1996; an exchange of 11 million barrels (1,800,000 m³) of Maya crude oil for 8.5 million barrels (1,400,000 m³) of higher value crude oil in 1998; a dry dock collapse in June 2000 just north of the Intracoastal Waterway near Lake Charles, Louisiana used by CITGO and Conoco refineries; and temporary loans in response to supply disruptions following Hurricane Lili in 2002 and several strong storms during the 2004 Atlantic hurricane season.
On November 13, 2001, President George W. Bush announced that the SPR would be filled, saying, "The Strategic Petroleum Reserve is an important element of our Nation's energy security. To maximize long-term protection against oil supply disruptions, I am directing...the Secretary of Energy to fill the SPR up to its 700 million barrel [111,000,000 m³] capacity." The highest prior level was reached in 1994 with 592 million barrels (94 million m³). At the time of President Bush's directive, the SPR contained about 545 million barrels (87 million m³). By redirecting a certain amount of imported crude oil to the reserve, some think this effectively raised oil prices by 28 cents per gallon (7c/L). Since the directive in 2001, the capacity of the SPR increased by 27 million barrels (4.3 million m³) due to natural corrosion of the salt caverns in which the reserves are stored.
On August 17, 2005, the SPR reached its goal of 700 million barrels (111,000,000 m³), or about 96% of its now-increased 727 million barrel capacity. Approximately 60% of the crude oil in the reserve is the less desirable sour (high sulfur content) variety. The oil delivered to the reserve is "royalty-in-kind" oil—royalties owed to the U.S. government by operators who acquire leases on the federally-owned Outer Continental Shelf in the Gulf of Mexico. These royalties were previously collected as cash, but in 1998 the government began testing the effectiveness of collecting royalties "in kind" - or in other words, acquiring the crude oil itself. This mechanism was adopted when refilling the SPR began, and once refilling is completed, future royalties will be paid into the Federal treasury.
This is a good move, by President Bush,
exactly what the SPR was intended for.
I don't believe all the crap talk about 'refinery shortage'.
Until last year, the wholesale price of gasoline v the
price of crude, was reasonable.
With high prices, airlines will conserve, by
going bankrupt, third worlders will conserve, by starving,
New Englanders will conserve heating oil, by shivering,
all those, reducing pressure on refining capacity.
I don't see how this helps. Yes, the supply of oil has been interrupted, but more importantly, the refining capacity has been diminished. So all this oil that will be released will be refined where???
Here is a link that will open your eyes about a process improved on by Lewis Karrick who back in the 1920's had made gasoline from coal and in this process could give away the gasoline for free and still make money on the other products. Here is the link.....Karrick
We could decentralize our dependence on oil and oil companies and allow states and local communities to create their own fuels. This would free our economy from the crazy world of oil and allow us to get on with cheap energy which we need.
Expect a major slowdown in our economy if we do not act soon.
Well, Sinator Chucky Schumer of New York will have to think up a new reason to get in front of the T.V. cameras and rant.