Remember just 2 years ago when Wall Street was blaming the energy crisis on those pesky environmentalists who just wouldn't let Big Oil build more refining capacity? As I said then, and will repeat ad nauseum, the U.S. has refining capacity coming out of its ears - because we don't have enough Oil to keep all of the refiners busy.
But read the article... the nit wit that wrote it blames the problem on:
Meanwhile, biofuels, hybrid cars and a deep economic recession have cut into demand. Fuel inventories have risen steadily, especially in the Northeast, protecting consumers from any sudden kinks in the supply chain.
Go that? Biofuels and hybrid cars! Not the fact that Oil imports are down 2.5 million bpd in only 3 years!
Propaganda is everywhere.
The refiners cannot pay the bills with propaganda. Never before in the history of the Age of Oil has the the American refining industry cut such capacity. My bet is they have a couple of sharp guys who can think as well as count.
This is just another Dot that I am connecting that supports my "The Oil Import Crisis is Here and Now" thesis.
More soon,
Libertariananimal (at) gmail (d0t) com
6 comments:
i suspect you all might want to check out "cracking" as in oil refining. if i remember correctly, any single oil refinery can only process a certain type of crude oil.
you can't refine heavy sulfur oil in a sweet crude cracker...
i don't think there's much refinery capacity for the low grade oils left.
personally, i don't think the environmentalists were that far off, except in that idiotic kindergarten knee jerk response: "the government has got to do something about it..."
nothing like... "well your gonna have to learn to do without, or turn off the god damn TV and do something for yourself..."
thank god for obamacare, all you idiot asses will get turned into drug soaked drones....
Good to see you back on the Peak Oil beat Greg. You are awesome at it. Fantastic analysis over the last three posts. I am fully in agreement with you. The only thing I am not sure about is why demand has fallen so precipitously as to make the drop in supply a non issue. And this seems to be an incredible drop in supply. Historic really. This tells me that the economy is hit much worse then the numbers show. It also tells me that as soon as any real recovery would be about to happen the price per barrel will rocket through $100/bbl. And that will knock the recovery down again. So for me the easiest way to find out whether any recovery is actually taking place is by the price of gas in the US. So far the government is fiddling with numbers to make the situation appear better then it really is. It seems that just like with IEA, you can't trust numbers created by a Political Organization.
Best regards,
Chuck H.
Those who expect we will all just crank along as we adapt to 30% less oil are not taking into account the impact on state coffers and what a breakdown of safety nets will mean to our inner cities. We have an entire society that exists on the largess of state and federal "programs" If we can't fund WIC and Head Start and food stamps and medicaid and fuel assistance and food stamps and AFDC and welfare and SSI (this is a huge one) then we will have an enormous group of angry, hungry people in a tight mass. Talk about a long, hot summer. Is it doomer to chose to live in a place that keeps one well away from large cities, in an area with reliable rainfall and good soil? I think it's nuts to be in a place without a strong social fabric and a way to provide food to it's citizens. I am still hoping that riots and civil unrest are confined to the big population centers but they may not be. I don't call myself a doomer. I call myself a realist.
Kathy:
I would not call you a "doomer", either.
People that interpret their environment, and take appropriate action, are just exercising good judgement.
"Doomers" use this issue to agitate for policy changes while doing nothing (for) themselves (or others).
I LOVE the lifestyle of homesteading, and it would appear you do as well. That does not mean everyone would enjoy it.
Anon:
The environmentalists are certainly correct in MUCH of their activities - but too often they allowed themselves to be used as a bludgeon for their masters in areas that were not supported by science. I prefer to steer clear of these folks - you can't have a co-examination of the facts with a "true believer".
Coal Guy:
"Demand" is not desire. "Demand" is what the end user is ready, willing, and able to pay for.
"Demand" can never exceed "Supply".
Ergo, if the "supply" is cut, for whatever reason, "demand" will fall and the two will be brought into equilibrium by price.
Anon:
Refineries can process different kinds of Oil. Certain equipment at the refiner is dedicated for certain materials.
I believe you are correct in that we have over capacity of "sweet" processing equipment and enough "sour" processing equipment.
The Mad Scientist is better able to speak on the subject. Feel free to ping him.
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