Petroleum Industry Christmas Wishlist

Conservative pundits are quick to point out that no "new refineries have been built since 1976", and even quicker to blame "environmentalists". But the facts just don't support that. Refiners have chosen the environment that they do business in, and in some cases have willingly contributed to it. (Plenty of data here.) Here's why:

• The government has allowed the industry to merge, consolidate, and restrict refining capacity, thus impacting pricing, supply, and demand.
• The quest for profits has caused the need to run extremely lean supplies (ie. no stockpiles of crude - it arrives when you need it, not before) and has resulted in susceptability to wild volatility in prices, but has allowed refiners to operate at very high efficiency but with no margin of excess capacity for temporary shortages, disasters, etc.
• Oil refiners trimmed back capacity after the Oil Crash of the early 1980s and have been unwilling to reinvest in new technologies unless environmental restrictions and local fuel cleanliness mandates are reduced.

As one would expect, Bush's solutions nicely match up with the wishlists of OPEC and US refiners, who in the past few decades have largely undone the breakup of Standard Oil (via) via mergers and joint ventures. Representative Joe Barton, (R-TX), Chairperson of the Energy and Commerce Committee, incidentally up for reelection and well funded, by "the industry" through various Political Action Committees, has released a draft of the predictably named (to be found here when released) Gasoline for America's Security Act of 2005 (committee discusion and webcast are scheduled for 9/28 at 8 am.) Given that new refineries are years away, there is still no solution for current prices or the (90%?) increase in prices since January of 2001. [from MetaFilter.com]