Oil production highest in 20 years while use is lowest in 17 years

[HALLGATOR]

Production up and use down should portend a better picture for the future needs of our country. The thing is will they use this seeming reprieve to continue looking for new alternatives to oil or 25 years down the road will be still be hooked on oil with no other viable choices.

The rapid growth in U.S. oil production has surprised even industry insiders.

An oil well pad sits outside Browning, Mont. (AP Photo/Matt Volz).Forecasts that once sounded far-fetched are becoming reality. The oil production boom had been expected, but the magnitude of change in such a short period of time is a surprise. U.S. oil production is at its highest level in 20 years, while at the same time U.S. oil demand is at a 17-year low.

The International Energy Agency projects the U.S. could even leap frog Saudi Arabia and Russia to become the world's biggest oil producer by 2020.

"The view I have is the U.S. will be a lot less dependent with Canada. That will really reduce imports, combined with more fuel-efficient cars, from outside North America. We'll still be importing some, but it's certainly a rebalancing of global oil. That oil that was coming to the United States will go somewhere else and that somewhere else would be Asia," said Daniel Yergin, vice chairman of IHS. "The other place where oil demand is really growing happens to be the Middle East."

http://finance.yahoo.com/news/us-oil...F9BRkM-;_ylv=3

[Lawdog88]

And there seems to be one heck of a lot of problem getting it refined.

But even if it there was a greater refining capacity, if the price of refined products were greater overseas, then they would be shipped there, instead of either used here or refined into gasoline.

So much for the price of gas.

[HALLGATOR]

I believe I've read where several refineries have been shut down over the last few years.

[rivergator]

Originally Posted by HALLGATOR

I believe I've read where several refineries have been shut down over the last few years.

Yes, oil companies have shut down refineries in order to keep prices high.

[G8trGr8t]

refineries that could not meet epa ever stricter rules were shuddered. some remained open when it was becoming obvious that NE would be looking at $5 gas a year before the election and lots of union jobs would be lost. dem connected private equity carlyle group bought them and then presto whammo epa gave them extensions to meet epa guidelines. remaining refineries spent or are spending big $$ to meet carbon rules (global warming) and that is why we have $4 gas while wti oil is around $90

and usa will never pass saudi's or russia in production of crude oil. what is being referred to is barrels of oil equivalent when they talk about us oil production. us numbers include massive increases in nat gas production while neither saudi or russia includes nat gas in their numbers.

the real problem isn't getting it refined it is getting it to the refineries and from the gulf coast refineries to other coastal markets. jones act is major problem moving refined fuels to east and west coast and pipeline limitations are problem getting it to refineries.

state department issued new keystone xl report on new route friday. no environmental harm. what will oblamer do now?

we have a replacement for a lot of imported oil. it is nat gas but we are wasting money on g teslas and volts and solyndras instead of nat gas trucks and trains and replacement of fuel oil furnaces with nat gas furnaces. oblamer hates carbon based fuels so anything that increases the price is good to him even though chewie was the only one to admit to their goal to drive up price of gas

[G8trGr8t]

Originally Posted by rivergator

Yes, oil companies have shut down refineries in order to keep prices high.

you really do not know what you are talking about here but carry on anyway

[rivergator]

Originally Posted by G8trGr8t

you really do not know what you are talking about here but carry on anyway

Really?

The more likely reason behind the price increase, though certainly less compelling as a political argument, is the recent spate of refinery closures in the U.S. Over the past year, refineries have faced a classic margin squeeze. Prices for Brent crude have gone up, but demand for gasoline in the U.S. is at a 15-year low. That means refineries haven’t been able to pass on the higher prices to their customers.

As a result, companies have chosen to shut down a handful of large refineries rather than continue to lose money on them. Since December, the U.S. has lost about 4 percent of its refining capacity, says Fadel Gheit, a senior oil and gas analyst for Oppenheimer. That month, two large refineries outside Philadelphia shut down: Sunoco’s plant in Marcus Hook, Pa., and a ConocoPhillips plant in nearby Trainer, Pa. Together they accounted for about 20 percent of all gasoline produced in the Northeast.

link

ake this internal Texaco strategy memo: "[T]he most critical factor facing the refining industry on the West Coast is the surplus of refining capacity, and the surplus gasoline production capacity. (The same situation exists for the entire U.S. refining industry.) Supply significantly exceeds demand year-round. This results in very poor refinery margins and very poor refinery financial results. Significant events need to occur to assist in reducing supplies and/or increasing the demand for gasoline." The memo went on to discuss a sucessful campaign in Washington State to shrink refined supply by removing other additives in the gasoline that filled gas volume.

Another Mobil memo shows the company promoted tough regulations in California to shut down an independent refiner. A Chevron memo acknowledged the industry wide need to shutter refineries and discussed how refiners were responding in kind.

link

Some of the nation's biggest oil companies are looking at permanently reducing how much gasoline and diesel fuel they make, a move that analysts say would almost certainly trigger higher prices for drivers.

Energy companies are suffering huge losses from refining because of slumping gasoline use -- a product of the economic downturn and changing consumer habits and preferences. Energy experts say refining cutbacks have begun and will accelerate as corporations strive for profits.
Major refiners have been circumspect about their plans, saying that they are considering options that could include closing refineries, selling parts of their operations, laying off workers and slashing spending.

"Refineries will have to be closed," said Fadel Gheit, senior energy analyst with Oppenheimer & Co. "Unless this excess capacity is permanently shuttered, a recovery in refining margins is unsustainable."

link

[HALLGATOR]

Seems to me there should be some alternative to closing refineries.

[G8trGr8t]

articles from 2005? really?

Yes unprofitable refineries were shut down. did you expect them to operate at a loss indefinitely?

how about something actually relevant instead of old and rumors and conspiracy theories

real reason Hovensa closed. epa costs and no access to cheap nay gas to power refinery

HOVENSA LLC, Clean Air Act Settlement

Washington, DC - January 26, 2011) - The U.S. Environmental Protection Agency (EPA) and the U.S. Department of Justice announced today that HOVENSA LLC, owner of the second largest petroleum refinery in the United States, has agreed to pay a civil penalty of $5.375 million and spend more than $700 million in new pollution controls that will help protect public health and resolve Clean Air Act violations at its St. Croix, U.S. Virgin Islands refinery. The settlement requires new and upgraded pollution controls, more stringent emission limits, and aggressive monitoring, leak-detection and repair practices to reduce emissions from refinery equipment and process units.

http://www.epa.gov/compliance/resour...a/hovensa.html


or why other east coast refiners closed

http://www.forbes.com/sites/larrybel...fined-results/

An estimated 50% of East Coast refinery capacity is predicted to shut down in June thanks to EPA regulatory restrictions on new refinery plant construction and upgrades, along with others that discourage Gulf Coast suppliers from piping gas into to this fuel-starved region. Unsurprisingly, the Energy Department warns that the resulting shortage will cause pump prices to spike, and “While the short-term effects of the idled Philadelphia-area refineries will be concentrated in the Central Atlantic, their long-term impacts will be more evenly spread throughout the entire East Coast.”

Three refineries, including two owned by Philadelphia-based Sunoco Inc. that have supplied about half of the gasoline, diesel and jet fuel, have already closed in just the past six months. They had lost nearly $1 billion over three years after shelling out $1.3 billion to comply with stricter EPA rules at a time when demand for gasoline fell and the cost of foreign crude soared.

Sonoco also worried that those regulatory costs would grow exponentially under the Obama administration through stiff noncompliance fines and other penalties that have hit other refineries. Its 2011 report filed with the SEC stated that: “Compliance with current and future environmental laws and regulations will require us to make significant expenditures, increasing the overall cost of operating our business, including capital costs to construct, maintain and upgrade equipment and facilities.” It went on to say: “To the extent that these expenditures are not ultimately reflected in our products or services, our operating results would be adversely affected.”

and how WH partnered with hedge fund to get special treatment from epa so they didn't have to comply with emissions rules

http://www.washingtonpost.com/busine...1_story_1.html

That had become a big disadvantage. The surge in U.S. oil supplies derived from shale and the pipeline bottleneck in the hub at Cushing, Okla., had driven down the price of the U.S. benchmark crude, West Texas Intermediate used by many Midwest and Gulf Coast refiners. But the Philadelphia refinery imported oil primarily from West and North Africa that is linked to the much higher London benchmark, Brent crude. The gap between the benchmarks is about $23 a barrel.

Brady was trying to get Carlyle help from the administration on EPA permits, but the White House was uneasy about being seen as helping a private-equity firm while the Obama campaign was busy lambasting Mitt Romney’s Bain Capital. Brady contacted Vice President Biden and spoke by phone with Sperling, who said he talked to Obama.

“The president was in campaign mode banging on Romney for being a hedge fund guy. And here he was helping a hedge fund,” Brady said. “They didn’t want the publicity.” (Both Bain and Carlyle call themselves “alternative asset managers,” not hedge funds.)

Brady said Pennsylvania’s Republican Gov. Thomas W. Corbett and the White House were also both worried about being blamed by the other if efforts to save the refinery failed.

Meanwhile, the EPA was bending. To avoid public hearings and requirements of new source review, an existing plant making changes had to balance any emission increase with a decrease in another part of the plant. There is a narrow exception that allows an decrease at a plant to offset an increase at another, but these are designed for adjacent facilities that can’t operate without each other.

In the end, the EPA said it would allow the Philadelphia refinery to offset anticipated emission increases at that plant — related to Carlyle’s plans to add facilities — with reductions resulting from the closure of Sunoco’s Marcus Hook refinery.

replacing $120 brent sea oil with $85 bakken oil was a big help but without epa help with a very questionable ruling due to political pressure from WH it would have still been closed

[gatordowneast]

Useage down because 23 M Americans are out of work, working part time or have given up. What is office vacancy rate in your community? What is retail vacancy rate in your community? What is labor utilization rate nationally? What is our manufacturing plant utilization rate?

Easy to explain less energy use. It ain't due to the Priuses and Volts running around the roads. Doesn't require much energy use waiting on a guvmint check or to have one's EBT card reloaded each month.

[g8trjax]

Originally Posted by gatordowneast

Useage down because 23 M Americans are out of work, working part time or have given up. What is office vacancy rate in your community? What is retail vacancy rate in your community? What is labor utilization rate nationally? What is our manufacturing plant utilization rate?

Easy to explain less energy use. It ain't due to the Priuses and Volts running around the roads. Doesn't require much energy use waiting on a guvmint check or to have one's EBT card reloaded each month.

Party pooper, haven't you seen the stock market?

[The_Graygator]

Oil production on private land may be the highest, but not on Federal land, where most of the oil is and we're restricted from drilling because of the Left and their special intrests.

[gator421]

Originally Posted by g8trjax

Party pooper, haven't you seen the stock market?

What does that have to do with anything? Are you against free enterprise?

[gator421]

Originally Posted by The_Graygator

Oil production on private land may be the highest, but not on Federal land, where most of the oil is and we're restricted from drilling because of the Left and their special intrests.

Generalize much?

[G8trGr8t]

Originally Posted by gator421

What does that have to do with anything? Are you against free enterprise?

so the fed pumping up their balance sheets to the tune of a trillion a year is free enterprise now?

http://www.businessinsider.com/calif...eserves-2013-2

The Solution To California's Problems Is Beneath Its Feet — But Rich Environmentalists Are Having None Of It

SHALE exploitation in North Dakota has lifted incomes and brought unemployment down to 3.2% of the workforce, the lowest level in the country.

Californians are rarely found looking longingly towards the Midwest. But the revelation that their state, with unemployment at 9.8% and America’s highest poverty rate, may be sitting on the largest deposit of shale oil in the continental United States has led some to wonder if their salvation lies 10,000 feet (3,000 metres) beneath them.

California has been an oil state since 1865. Thanks largely to reserves that can still be tapped by conventional means, it remains the third-largest producer in the country. Output has lately been declining by 2-3% a year, according to the state’s Energy Commission. But in 2011 the federal Energy Information Administration declared that the Monterey shale formation, which spans 1,750 square miles (450,000 hectares) in southern and central California, held 15.42 billion barrels of recoverable oil, 64% of the total estimated to be in the 48 contiguous states.


Read more: http://www.gatorcountry.com/swampgas...#ixzz2MgBJDJI1

put it in the California thread but Califonia Monterey shale is estimated to hold appx. 15.4 BILLION barrels of RECOVERABLE oil but they can't get permits to drill it. Even gov moonbeam sees this as a problem and fired two of the top oil regulators in the state recently because they didn't get a permit that they couldn't deny.

And that 15.4 billion barrels is based on today's techniques of getting only 5 - 8% of shale oil with directional drilling and fracking. That is more than the estimated recoverable shale oil from ND, Oklahoma, Kansas, Lousiana, and Texas combined. As the technique is refined and enhanced oil recoevery methods increase the % recoverable, there will be even more.

How much would it help the economy to keep $1.6 trillion here instead of shipping it overseas to buy imported oil? And the multiplier effect would be huge as there would be real jobs created from the resource instead of money taken from producers to give to others. Until we get back to using our own resources and incorporating that wealth generation into our economy we will be stuck in this middling no growth economy.

[HALLGATOR]

Originally Posted by gatordowneast

Useage down because 23 M Americans are out of work, working part time or have given up. What is office vacancy rate in your community? What is retail vacancy rate in your community? What is labor utilization rate nationally? What is our manufacturing plant utilization rate?

Easy to explain less energy use. It ain't due to the Priuses and Volts running around the roads. Doesn't require much energy use waiting on a guvmint check or to have one's EBT card reloaded each month.

I would imagine it is a combination of both vehicles which get better mileage and people out of work.

[gatordowneast]

Originally Posted by g8trjax

Party pooper, haven't you seen the stock market?

I'm riding that baby up just like everyone else but I also look at top line revenue growth and don't see very much at established companies. I truly believe the market goes up or down not so much due to "real values" but due to "real momentum traders" including big ones who don't own stocks...they only rent them for a few seconds at a time.

[The_Graygator]

Originally Posted by gator421

Generalize much?

Facts are facts.

The all powerful, ever-increasing federal government the libs here desire running more and more of their lives (and everyone else's who don't want them to), isn't the one increasing oil production, it's the private sector, so when Obama has said this on occasion, he's lying through his teeth, which is, as usual, par the course.

Obama has had practically zero to do with it.

[G8trGr8t]

but they are the ones responsible for refineries having to invest billions due to the ever demanding epa regs and now those billions in investments are being charged to the people in the from of higher gas prices but river wants to blame it on the refineries that should spend all that money but never expect to recover any of it.

i think it was oblamer that said elections have consequences and one of the consequences of his war on carbon based fuels is $4 gasoline.

[gator421]

Originally Posted by The_Graygator

Facts are facts.

The all powerful, ever-increasing federal government the libs here desire running more and more of their lives (and everyone else's who don't want them to), isn't the one increasing oil production, it's the private sector, so when Obama has said this on occasion, he's lying through his teeth, which is, as usual, par the course.

Obama has had practically zero to do with it.

It is a generalization that everyone you categorize as a liberal believes what you think they believe. Facts are not facts. Opinions, however..