The price of gas

"Mike Rapoport" wrote in message
k.net...
Input into refineries is consumption. Nobody except refineries buys
crude.

Output from refineries is business/consumer consumption and that's what the
numbers measure.

"Mike Rapoport" wrote in message
ink.net...
High real estate prices on the west coast have halted refinery
construction
there as much as anything else. All factors are in play of
course...permitting requirements, local opposition, tax climate, the price
of steel, the non-desirablility of living next door to a refinery. When
all
these variables are considered, there is a price level where a new
refinery
will be built. When we get there, the refinery will be built.


Nice...you just contradicted what you said in your post to me.

"Mike Rapoport" wrote in message
nk.net...
"In a democracy, the people eventually get what they want." I don't know
who originally said that, but its true. The people have what they
"PREFER".
The perfectly fair system is the one where everyone is equally unhappy.

It might have been Lincoln Steffen, the ACP member who returned from Russia
in the 30's and marvelled how "equally shabby" everyone was as though it was
a GOOD thng.

"Ash Wyllie" wrote in message
...
I've heard that US refineries are operating at damn near 100% of ALLOWED
capacity. Can anyone verify that?


It is 90%+ of installed capacity. Which leaves very little room for error.

In 1981, according to the National Petrochemical and Refiners
Association,
321 refineries pumped out 18.6 million barrels a day of gasoline. Today
only 149 refineries, run by 60 companies in 33 different states, pump
out
16.8 million barrels of gasoline daily - almost 2 million barrels a day
less. They are operating at 93 percent of capacity, well above the
industrial average, with little time left for maintenance and upgrades.

Tom Bray, Washington Times

Sounds "damn near" to me.

What about drillings? I recall (my memory started to go longggg before I hit
50) that the only new drillings are off shore, and that is so restricted by
EPA (and other alphabet soup) that it has to be an EXCEPTIONALLY GOOD
reading before they spend the money. Any idea of the ratio of cost of
drilling to cost of government paperwork and bureaucratic BS? :~)

As of Friday there were 1056 rigs drilling onshore in the US and 95 drilling
offshore.

Mike
MU-2



"Tom Sixkiller" wrote in message
...
"Ash Wyllie" wrote in message
...
I've heard that US refineries are operating at damn near 100% of
ALLOWED
capacity. Can anyone verify that?


It is 90%+ of installed capacity. Which leaves very little room for
error.

In 1981, according to the National Petrochemical and Refiners
Association,
321 refineries pumped out 18.6 million barrels a day of gasoline.
Today
only 149 refineries, run by 60 companies in 33 different states, pump
out
16.8 million barrels of gasoline daily - almost 2 million barrels a
day
less. They are operating at 93 percent of capacity, well above the
industrial average, with little time left for maintenance and
upgrades.

Tom Bray, Washington Times

Sounds "damn near" to me.

What about drillings? I recall (my memory started to go longggg before I
hit
50) that the only new drillings are off shore, and that is so restricted
by
EPA (and other alphabet soup) that it has to be an EXCEPTIONALLY GOOD
reading before they spend the money. Any idea of the ratio of cost of
drilling to cost of government paperwork and bureaucratic BS? :~)

"Tom Sixkiller" wrote in message
...

Do your energy companies have to abide by more and more, or less and less
environmental regulation? Is it easier or harder to drill now than it was
back 30 or so years ago?

These don't seem like useful comparisons. Many environmental regulations
came about because of eggregious pollution cases so some of the regulation
is due to their own irresponsibility in the past. I do not believe the
present corporate quarterly-results-driven culture would do much better.
Also, the push to enact legislation limiting their liability makes it look
like they want the profits without the responsibility.

There is virtually no industry which is not more regulated than it was in
the past. This is a fact of life in virtually every country. You can spend
your life complaining about and fighting it or you can adapt and deal with
it. It is left as an exercise to the reader as to which one will work out
better for you.

"Tom Sixkiller" wrote in message
...

What about drillings? I recall (my memory started to go longggg before I
hit
50) that the only new drillings are off shore, and that is so restricted
by
EPA (and other alphabet soup) that it has to be an EXCEPTIONALLY GOOD
reading before they spend the money. Any idea of the ratio of cost of
drilling to cost of government paperwork and bureaucratic BS? :~)


Offshore rigs are extremely expensive to build and operate. This surely has
an effect on how many are constructed.

Sure they are regulated. The damage potential to the environment from them
is large and besides the environment itself, entire local economies can be
ruined for long periods of time when an accident occurs.

Perhaps it would be a good first step if the oil companies would step up to
the plate and offer to fully compensate other parties for all damage that
occurs due to their operations, including reduction in property values.

I am not against oil companies and progress but I do think that every
company must take responsibility for their actions and effects and the costs
of their operations on others. Only when all externalities are internalized
can the most efficient economic choices be made.

Refineries don't "output" crude.

Mike
MU-2

"Tom Sixkiller" wrote in message
...

"Mike Rapoport" wrote in message
k.net...
Input into refineries is consumption. Nobody except refineries buys
crude.

Output from refineries is business/consumer consumption and that's what
the
numbers measure.

"Tom Sixkiller" wrote in message
...

"Mike Rapoport" wrote in message
ink.net...
"Tom Sixkiller" wrote in message
...

"Mike Rapoport" wrote in message
nk.net...
I agree that refining capacity has been impacted by various
enviornmental
regs. These haven't affected drilling (and hence production) much
though.


Environmental regs haven't affected drilling? Are you kidding?



Let's see...where have I been. I was an energy analyst for about a
decade
and since then I have made a reasonable living investing in energy
companies. Where have you been? Listening to AM radio?


I don't get a good AM signal here.

Do your energy companies have to abide by more and more, or less and less
environmental regulation? Is it easier or harder to drill now than it was
back 30 or so years ago?

That isn't the point. The point is whether or not enviornmental
restrictions have had a meaningful effect on depressing drilling activity.
Obviously they have had some effect. The main depressent on drilling has
been the need to go deeper and deeper to find less and less.

Ask your energy companies how mush they do new drilling now than they did
in
years past.

See above. Budgets are up across the industry due to better pricing but
drilling will never reach the levels of 40 yrs ago simply due to the fact
that the resource has been largely exploited in the US.

Are you always so goddamn pompous?


Only when I am dealing with a jackass who considers himself an expert of
everything.without knowing anything about the subjects he pontificates on.
Face the facts, you have absolutely no idea what the cost or effect of
eviornmental regulations is on O&G drilling. Industrywide they are a
rounding error.


Mike
MU-2

Or does simple economics break down when dealing with oil?

There is more than a bit of truth in that off-handed remark.

While the laws of economics still work, the normal structure of supply and
demand sure doesn't. There is nothing "simple" about economics when
dealing with oil.

There are simply too many countries, too many ideologies, too many axes to
grind, and too much money involved for this to be anything but difficult.
--
Jay Honeck
Iowa City, IA
Pathfinder N56993
www.AlexisParkInn.com
"Your Aviation Destination"