Biden considering emergency measures to boost refinery output

[Dave_5k]

Good overview summary from the Washington Post today on challenges in boosting refining output, shared as a "gift" link article so you shouldn't need subscription to read:

https://wapo.st/3O77KwR

...
There is a large refining facility in Houston up for sale right now.
“If there was someone out there who believed this would be a strong business in the future, this is an asset they could buy,” said Jacques Rousseau, a managing director at ClearView Energy Partners, an independent research firm.
The problem: Nobody wants to buy it. There has not been a single viable bid.
...
As the energy crunch drives record profits at American oil refineries, the owners of what had been the largest such facility in the Northeast have no regrets about tearing the place down.

Hilco Redevelopment Partners has been hauling out 950 miles of pipe from the former Philadelphia Energy Solutions refinery, abandoning the property’s 150-year history of processing crude oil into fuel in this city. The firm is spending hundreds of millions of dollars to convert the 1,300-acre site along the Schuylkill River into a green, high-tech campus for e-commerce and life sciences companies.
...
The case of the shuttered Philadelphia Energy Solutions refinery illustrates how little influence the White House has over such operations.

The Trump administration had worked aggressively to keep the plant that was churning out 335,000 barrels of fuel per day from closing, warning it played an important role in U.S. energy security and independence. The White House had dispatched Peter Navarro, a top Trump economic adviser, to try to help advance the bid of a group of energy executives who planned to rehabilitate the bankrupt facility.

The bid, which had the backing of organized labor, fizzled.

 

[K1052]

The Summers fix for a supply side problem is to shove millions of Americans into poverty for a protracted period of time. This of course will actually not fix anything because refining capacity will continue to shrink and would do so more rapidly if he achieved the conditions he wants. Truly reprehensible stuff.

https://twitter.com/x/status/1539012452905627650

 

[IronWing]

Because worker pay is the issue, not parasitic "investors".

 

[uclaLabrat]

Or wealth inequality or lack of competition. How soon we forget.

 

[conehead433]

Republicans will do everything they can to keep gas prices high including voting against anything to curb price gouging. It's all part of their playbook which is to make all of us want to vote out the democrats and Biden because this is all their fault. The GOP absolutely does not give a shit about the American people. Too bad voters can't see that.

 

[K1052]

https://twitter.com/x/status/1539284502232674304

tfw you realize people understood that thing you said

 

[Roger Wilco]

Oil is down another 6% today.

 

[UNCjigga]

Oil is down another 6% today.

Biden is calling for a gas tax holiday (presumably until Labor Day?) but pundits are warning there’s nothing to ensure Big Oil actually passes that onto consumers at the pump…in other words, it can drive profits even higher.

 

[NWRMidnight]

Biden is calling for a gas tax holiday (presumably until Labor Day?) but pundits are warning there’s nothing to ensure Big Oil actually passes that onto consumers at the pump…in other words, it can drive profits even higher.

I really don't think 18.5 Cents a gallon is going to really change anything. Now, if the state governments did the same thing, then it might make a dent in the price.

 

[K1052]

Oil trade is realigning. Russian crude headed to India and China at a discount displaces existing supplies which now head elsewhere.

Tax holiday is a bad idea policy wise and not likely to see implementation and the WH knows that. Good messaging? Maybe.

 

[uclaLabrat]

Yeah. Honestly for messaging i feel like they should be leveraging the pain to direct attention to renewables and acclerate the transition. Oil companies wont invest so lets steer into the skid and accelerate the decline of fossil fuels within our energy generation infrastructure. Wind and solar will get cheaper and more stable as they scale.

 

[K1052]

Yeah. Honestly for messaging i feel like they should be leveraging the pain to direct attention to renewables and acclerate the transition. Oil companies wont invest so lets steer into the skid and accelerate the decline of fossil fuels within our energy generation infrastructure. Wind and solar will get cheaper and more stable as they scale.

In the context of liquid fuels this probably means more support for battery manufacturing in the US. Along with smoothing greater domestic production of the materials required for them and EV motors. The car buying public seems increasingly willing to entertain the idea.

Solar and wind are already taking over. We just need the transmission and storage to follow on.

 

[Zorba]

Biden is calling for a gas tax holiday (presumably until Labor Day?) but pundits are warning there’s nothing to ensure Big Oil actually passes that onto consumers at the pump…in other words, it can drive profits even higher.

Yeah, there absolutely should be no gas tax holiday. It'd end up just like all the holidays during COVID where people never want them to go away.

Plus the tax is already too low, and no one would even notice 18.5¢/gal even if the gas companies passed it along.

 

[Brovane]

Yeah. Honestly for messaging i feel like they should be leveraging the pain to direct attention to renewables and acclerate the transition. Oil companies wont invest so lets steer into the skid and accelerate the decline of fossil fuels within our energy generation infrastructure. Wind and solar will get cheaper and more stable as they scale.

The transition from Petroleum for transportation is going to occur over several decades and might not ever occur for some industries. For example, I don't see a path for Commercial Jets to transition away from Refined Petroleum.

We need a strategy for stabilizing the cost of refined petroleum products stable during the transition. Just telling everyone they can buy a BEV because of high gas prices isn't a strategy. I don't see many BEV tractors available to harvest crops in the field. If we don't have a strategy, people are going to get upset and we could have a situation that those advocating for the transition get voted out of office and we have a over correction back the other direction.

 

[hal2kilo]

what about these guys?
View attachment 63347

I have a MFr that lives behind me with a gate the has that flag and the words Blue lives matter covering it. He also has the most ridiculous off the wall political posters for the craziest righties in the state. Zero name recognition, so they are way out there. And of course (thank goodness a thick green belt is between me and him) the place looks like a junkyard in less than the 3 years he's lived there.

 

[K1052]

We need a strategy for stabilizing the cost of refined petroleum products stable during the transition.

The only entity capable of this I think is the US Government itself but oh man the cries of "socialism" that would ensue make it politically difficult.

 

[Brovane]

The only entity capable of this I think is the US Government itself but oh man the cries of "socialism" that would ensue make it politically difficult.

Well this is what I think of that. I especially love the senior citizens that complain about Socialized medicine but are on Medicare.

 

[Thump553]

Biden is calling for a gas tax holiday (presumably until Labor Day?) but pundits are warning there’s nothing to ensure Big Oil actually passes that onto consumers at the pump…in other words, it can drive profits even higher.

CT put a temporary gas tax holiday into effect approximately April 1st. Our gas tax is twenty five cents. The first day of the drop (per Gasbuddy) a few stations dropped their price 30-40 cents. Within a couple of days the lowest price you could find was maybe a dime below what was charged before the tax holiday. Per AAA the latest (6/18/22) national gas average is $4.989 while the CT average for the same day is $4.921.

We are still going to have to pay to repair our infrastructure somehow, even if there is a tax holiday. Guess who is going to end up paying that bill? Conclusion: the consumer/taxpayer is getting screwed twice with such holidays.

 

[blackangst1]

I havent read the entire thread, but what about halting US petroleum exports?

 

[[DHT]Osiris]

https://twitter.com/x/status/1539284502232674304

tfw you realize people understood that thing you said

View attachment 63389

He should have added 'if Trump hadn't fucked around with the economy for four years to make it look like it was better than it was, we wouldn't be finding out.'

 

[Brovane]

I havent read the entire thread, but what about halting US petroleum exports?

That really doesn't help much in my opinion when the issue is refined products. We are down about 1-Million Barrels a day in refinery capacity from right before COVID.

 

[fskimospy]

CT put a temporary gas tax holiday into effect approximately April 1st. Our gas tax is twenty five cents. The first day of the drop (per Gasbuddy) a few stations dropped their price 30-40 cents. Within a couple of days the lowest price you could find was maybe a dime below what was charged before the tax holiday. Per AAA the latest (6/18/22) national gas average is $4.989 while the CT average for the same day is $4.921.

We are still going to have to pay to repair our infrastructure somehow, even if there is a tax holiday. Guess who is going to end up paying that bill? Conclusion: the consumer/taxpayer is getting screwed twice with such holidays.

Yes, gas tax holidays are stupid. This is caused by supply constraints so all you're doing by cutting the gas tax is increasing demand. He would be better off with some sort of windfall profits tax on oil/refining companies that would then be used to bring refineries back online or to provide guarantees to producers if they expand supply.

 

[MrSquished]

Well this is what I think of that. I especially love the senior citizens that complain about Socialized medicine but are on Medicare.


View attachment 63423

after leaving their Medicare funded doctor's appointment

 

[Dave_5k]

Yeah. Honestly for messaging i feel like they should be leveraging the pain to direct attention to renewables and acclerate the transition. Oil companies wont invest so lets steer into the skid and accelerate the decline of fossil fuels within our energy generation infrastructure. Wind and solar will get cheaper and more stable as they scale.

Except the administration is doing the opposite. They killed multiple GW of solar projects with announcement of potential for 240% retroactive tariffs on panels early this year. Only to finally announce some temporary relief earlier this month - although a 2 year window means new projects that take longer won't get started at all, alongside all the projects that were already shelved given complete infeasibility with risk of massive tariffs looming. And wind power installation had already been cratered at the start of this year, with wind tax incentives expiring at end of 2021 and no deal to extend - ironically wind projects mostly stopped because solar became more attractive due to continuing solar tax incentives (major overlap in developers and financers between the two), so most everyone had moved over to more profitable solar...

Zero communications from Biden or administration linking opportunity to lower long term gas price pain with renewables, they've refused to even try to make an argument for it.

Alongside zero movement on extending or updating renewable energy tax credits or incentives of any kind, repeatedly killed by big coal (Manchin).

And the gas tax holiday is pointless, other than as an attempt to be seen "doing something", the federal 18 cents on a gallon isn't going to change much. While political suicide, arguably what they should be doing is the opposite ~ put a soft floor on gas prices while prices are high, say at about $5/gallon, by having a variable gas tax increase that phases in when prices drop below that level to mostly offset further declines... but that will never fly in the US.

 

[K1052]

They killed multiple GW of solar projects with announcement of potential for 240% retroactive tariffs on panels early this year.

Commerce had to do what they did due to US trade law, however the admin could definitely have waived these tariffs much sooner than the did to preserve projects in the pipeline. Originally they said their hands were tied but that wasn't really accurate since while they can't interfere in the investigation they could waive the tariffs. This is more a symptom of the slow decision making the admin is prone to than anything.

Only to finally announce some temporary relief earlier this month - although a 2 year window means new projects that take longer won't get started at all, alongside all the projects that were already shelved given complete infeasibility with risk of massive tariffs looming.

The investigation will be done this year and a determination made. My suspicion is that this issue will be moot since letting the tariffs snap back will be unattractive and the admin may cancel them entirely anyway soon. The US is likely never to have a domestic panel industry of any size without substantial government support like the chipmakers are about to get.

Alongside zero movement on extending or updating renewable energy tax credits or incentives of any kind, repeatedly killed by big coal (Manchin).

This is one area that doesn't bother Manchin. Wind credits very likely to make what he's hashing out with Schumer. He's got a burr up his ass over EV credits going to foreign automakers but that may be resolved by raising the cap for US carmakers, reportedly.