Well, seeing as there has not been a new refinery built since 1976 (Marathon Oil in Garyville, LA) , I'd have to imagine it is not because of lack of planning. There are several factors that make building new refineries cost-prohibitive. This is only one of many reasons. But this is why people blames lefties for oil problems. However, the lawsuits that I mentioned apply more to new drilling sites than refineries. But as you've also mentioned before, the misinformed think that since no new refineries are being built, then there is no increase in production, and therefore the prices rise. This is not really correct; it is simply more profitable and sensible for Oil Companies to expand on existing refineries. The groundwork is already laid out. If you add to an existing facility, you can dynamically respond to the fluctuating supplies of crude. It is easier to scale down a portion of a refinery, than it is to shut down an entire one.
that's exactly right. ExxonMobile has dramaticly increased its production capability in the last 25 years. I'm sure it's not the only one. Why would they invest in expanding refinery capability when they can let demand drive up the price, (or speculators, or gouging, you can't tell me since there is only 5 major producers in the US, lack of competion isn't leading to collusion) and they can make more profit without increasing production.
This thread was about the price of oil, not gasoline. Unless I'm missing something, refinery capacity has absolutely nothing to do with the price of a barrel of oil. Buying a barrel of oil is a transaction that totally occurs before the refinery gets in the picture.
Just to update, go read post #1 in this thread, and dr. Hussman guessed that speculation did play a role in the rapid runup in the price of oil over the last 12 months (it would make sense that it did, since demand did not rise that fast, or fast enough to create a real shortfall of supply). In the last 4 weeks, oil has fallen from 145 a barrel, to 115, or about 20% decrease in the last month. The good dr. was calling for 60, I hope he's right. In the congressional testimony on speculation in the oil market, they said the production cost varied by where and how the production occurred (tar sands in Canada cost more to extract oil than onshore drilling), but the cost varied from 45 - 65 a barrel.
Just to update again, the good Dr. Hussman may hit the nail on the head. Oil is now around $60 a barrel. I think we can safely say that the degree to which speculation in the oil market affected the price was significant. We've seen a 60% decrease in the price since July! (147 down to 60)
I hope the poor CEO's of the 5 big oil companies don't go hungry or lose their homes over this. Maybe we better cut their taxes some more.
We know you and others don't like oil companies but I bet you drive a car. Normal people have stock in oil companies too btw. Somehow people like you, (not directed totally at you). Don't bitch or care about the out of control spending of big government, pork etc. There are just as many crooks in government than the private sector. There are probably more hands in the cookie jar but it never sees the light of day.
