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Hey Oil Barons.......


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6 minutes ago, CHIEF said:

If we could just get all our refineries up and running, modernize and increase the capacity of our existing ones, and keep from selling and dismantling existing refineries, these prices would probably go away. 

I laughed.

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26 minutes ago, Neonmoon said:

Can you show your work on this?

Lulz. Does he need to?

Also, the industry is under assault by the current administration. I was critical of the prior admin when they did stupid shit, and they did a lot. It is impossible to speak about the business without discussing admins.  If the thread is moved to CR, I won’t post much if ever. I’ll take timeouts here, reluctantly, but will just go elsewhere if we’re gonna moderate that way. 

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10 minutes ago, Neonmoon said:

Can you show your work on this?

https://cwilliamsmallinglaw.com/global_pictures/Bill_Smalling_Will_Refining_survive_the_CAA.pdf

 

Since the CAA costs as a percent of total annual refinery sales would be just over one percent, the refining industry would survive the CAA. However, the increasing CAA requirements such as GHG regulation through the CAA, the proposed ozone NAAQS and the E15 mandate and the RFS, together with downward U.S. gasoline consumption and refining capacity will increase the business pressures on the refining industry.

All of the costs to comply with the Clean Air Act are front loaded, in an industry that is falling out of favor with government sentiment. The juice isn't worth the squeeze.

The total capacity closed since 2010 is around 1,280,000 BBL/D, most of which is located on the U.S. East Coast. 

The article was written in 2011 when there wasn't a shortage of refined products, but a surplus. We are now in a shortage of refined products, but eliminated the capacity to keep up.

CHIEF

 

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If I were a candidate running for a national political office. My energy stance would be to offer guaranteed interest free loans to refiners to update refineries to refine WTI, comply with CAA and GSPS standards, and to offer the same loans for any regulations that get issued at a further date. Open up the bottleneck. As domestic demand goes down, export refined products to our neighbors, Third World countries aren't going to be buying Teslas. It's a National Security issue at this point.

CHIEF

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47 minutes ago, CHIEF said:

https://cwilliamsmallinglaw.com/global_pictures/Bill_Smalling_Will_Refining_survive_the_CAA.pdf

 

Since the CAA costs as a percent of total annual refinery sales would be just over one percent, the refining industry would survive the CAA. However, the increasing CAA requirements such as GHG regulation through the CAA, the proposed ozone NAAQS and the E15 mandate and the RFS, together with downward U.S. gasoline consumption and refining capacity will increase the business pressures on the refining industry.

All of the costs to comply with the Clean Air Act are front loaded, in an industry that is falling out of favor with government sentiment. The juice isn't worth the squeeze.

The total capacity closed since 2010 is around 1,280,000 BBL/D, most of which is located on the U.S. East Coast. 

The article was written in 2011 when there wasn't a shortage of refined products, but a surplus. We are now in a shortage of refined products, but eliminated the capacity to keep up.

CHIEF

 

Assuming I concede new refineries after 2010 were stopped because of CAA costs, which your paper argues in detail. What stopped new refineries being built between 1977 and 2010? 

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56 minutes ago, Porterhouse said:

I’ll take timeouts here, reluctantly, but will just go elsewhere if we’re gonna moderate that way. 

No you won't.  You'll disappear for a few days, create a new sock and start back up again.  And everyone in here will know exactly who it is posting under the new account but you'll deny it.

Rinse, wash, repeat.

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47 minutes ago, Neonmoon said:

Assuming I concede new refineries after 2010 were stopped because of CAA costs, which your paper argues in detail. What stopped new refineries being built between 1977 and 2010? 

FEE057A4-53C3-474F-AA37-AD8B8384813A.png.4ae14a689b1de5b6b232cf54fb693716.png

Declining production

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Posted (edited)

Possibly some modest relief on gas prices coming. RBOB futures are down almost 40 cents in the past 5 trading days and at a 3-week low.  A decent rule of thumb for Texas pump prices is to take RBOB and add ~40 cents and then round up to the nearest 9.

So, RBOB at $4.25, regular unleaded $4.69

RBOB at $3.89, regular unleaded $4.29

Edited by Storm the Field
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6 hours ago, CHIEF said:

The dumbasses that think it could be done in 5-10 years have never set foot in places like Guthrie, TX. or Vaughn, NM. Building $2mm recharging stations in towns that see maybe 20-25 fill-ups per day is ludicrous. There are vast swaths of the nation that are rural and desolate.


CHIEF

Jefe,

1. The commercial high-power fast-charging stations cost ~50k (30k/unit + 20k installation).  US Dept Energy paper 2015.  Prices prob much lower now.

2. The stations are not meant to keep citizenry of Guthries and Vaughns charged for their everyday motoring.  They are only needed along major arterial ways for long distance travel.

3.  You might be using analogues to gasoline station, but it doesn't work like that.  The city of Guthrie needs a gas station because that's the only place they can fill up.  Conversely, if you have an electric plug at home, you essentially have your own gas station. 

 

 

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1 hour ago, Neonmoon said:

So not the EPA?

I would say the cause during the 1970s to the present was increases in vehicles fuel mileage and efficiency offset the increase in demand. After the fuel shortage of 1973, 6 mpg muscle cars were traded in for Pintos, Chevettes, Cavaliers, and Golfs. Small cars started getting upwards of 25-30 mpg in the 70s and 80s. Large vehicles started getting that in the 90s-2000s with fuel injection. Also, OPEC had the chokes wide open and kept the market flooded with cheap oil.

Read post #5095, I'm not sure domestic demand has risen that much, but global demand is at its highest level. Even the middle class of Third World countries can now afford a clunker. A Global Economy affects us all, the good and the bad.

CHIEF

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22 minutes ago, 52-80 said:

Jefe,

1. The commercial high-power fast-charging stations cost ~50k (30k/unit + 20k installation).  US Dept Energy paper 2015.  Prices prob much lower now.

2. The stations are not meant to keep citizenry of Guthries and Vaughns charged for their everyday motoring.  They are only needed along major arterial ways for long distance travel.

3.  You might be using analogues to gasoline station, but it doesn't work like that.  The city of Guthrie needs a gas station because that's the only place they can fill up.  Conversely, if you have an electric plug at home, you essentially have your own gas station. 

 

 

What do you think the range would be on a F-350 EV pulling 24000 lbs. of a trailer full of cattle will be? 50 miles to the sale barn, and a return trip, reload, and make another run? Do you have to stop for 8 hours in the middle of the job to recharge? 

CHIEF

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Posted (edited)
51 minutes ago, CHIEF said:

What do you think the range would be on a F-350 EV pulling 24000 lbs. of a trailer full of cattle will be? 50 miles to the sale barn, and a return trip, reload, and make another run? Do you have to stop for 8 hours in the middle of the job to recharge? 

CHIEF

And that accounts for less than 1% of traffic, the vast, vast overwhelming majority of Americans drive less than 100 miles a day with the majority of those driving less than 50 miles a day which is well within the feasibility of EVs.

Edited by Not a Sock
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48 minutes ago, CHIEF said:

What do you think the range would be on a F-350 EV pulling 24000 lbs. of a trailer full of cattle will be? 50 miles to the sale barn, and a return trip, reload, and make another run? Do you have to stop for 8 hours in the middle of the job to recharge? 

CHIEF

Most of America doesn’t drive an F-350. Nevermind most people with an F-350 aren’t hauling a trailer full of cattle everytime they drive. 
 

Policies and progress don’t hinge on the minority. It’s like we shouldn’t spend money building highway infrastructures because the Amish in Pennsylvania do fine with their horses. 

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1 hour ago, CHIEF said:

What do you think the range would be on a F-350 EV pulling 24000 lbs. of a trailer full of cattle will be? 50 miles to the sale barn, and a return trip, reload, and make another run? Do you have to stop for 8 hours in the middle of the job to recharge? 

CHIEF

Petrochemicals aren't going anywhere, even with EV's. It's hard to beat the raw range, power, and toughness of diesel cycle engines, but most cars on the road can't do what you're describing lol. EV's are for everyday, around town usage, and maybe some sport/utility fun. Especially city driving with loads of start/stop traffic where they can recapture the kinetic energy while braking.

But as far recharging: the top end spec of electric charging is 350 KW, and you can pretty reliably find 150 KW charging for vehicles. A F150 lightning will go 15%->80% in about 41 minutes (according to Ford) with 150 KW charging. In a few years at 350KW (and higher I imagine) that'll be down to near 15 minutes. Charging at home is usually slower, but who cares you can leave it plugged in all night and trickle charge it

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Until recently, every time the cracks shot to the moon there was enough capacity to quickly squash them by running full tilt for a few months and flooding the market. That incremental capacity is now gone due to shutdowns over the past few years so there is no longer a quick fix. It really made no sense for refiners to add capacity through an entirely new refinery so they would add through smaller unit upgrades. We'll see if that changes going forward, but my guess is no. Refining isn't really a growth business.

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17 hours ago, Fudge Nuggets said:

No you won't.  You'll disappear for a few days, create a new sock and start back up again.  And everyone in here will know exactly who it is posting under the new account but you'll deny it.

Rinse, wash, repeat.

Negative. You could be more wrong but I doubt it. 

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9 hours ago, Okie State said:

Until recently, every time the cracks shot to the moon there was enough capacity to quickly squash them by running full tilt for a few months and flooding the market. That incremental capacity is now gone due to shutdowns over the past few years so there is no longer a quick fix. It really made no sense for refiners to add capacity through an entirely new refinery so they would add through smaller unit upgrades. We'll see if that changes going forward, but my guess is no. Refining isn't really a growth business.

There's also a secondary concern in that many of our refineries were built 40-50 years ago, and wear and tear is certainly a thing in high temp and pressure environments. It's horrifically expensive and labor intensive to build a refinery and will take years to turn a profit, so there's pretty much zero market incentive for refiners to build more

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16 hours ago, 52-80 said:

Most of America doesn’t drive an F-350. Nevermind most people with an F-350 aren’t hauling a trailer full of cattle everytime they drive. 
 

Policies and progress don’t hinge on the minority. It’s like we shouldn’t spend money building highway infrastructures because the Amish in Pennsylvania do fine with their horses. 

That minority, farmers and ranchers, is vital to our nation's food supply. EV (tractors and haul trucks) will not work for their needs. Being forced to buy EV $1.2mm tractors and $250k haul trucks isn't going to happen. We are still going to need cheap fossil fuels.

CHIEF

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47 minutes ago, CHIEF said:

That minority, farmers and ranchers, is vital to our nation's food supply. EV (tractors and haul trucks) will not work for their needs. Being forced to buy EV $1.2mm tractors and $250k haul trucks isn't going to happen. We are still going to need cheap fossil fuels.

CHIEF

Its not a mutually exclusive proposition. More people buying electric cars doesn’t make existing gas stations disappear or an existing Kubota stop functioning. 

Less demand for gasoline should also make it cheaper. 

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2 minutes ago, 52-80 said:

Its not a mutually exclusive proposition. More people buying electric cars doesn’t make existing gas stations disappear or an existing Kubota stop functioning. 

Less demand for gasoline should also make it cheaper. 

I'm all for people buying more EVs. I encouraged my mother to look into it yesterday. She hasn't driven over 150 miles in a day for years. It makes since for 100% of everyone to own an EV, but will still need an IC or hybrid for long road trips, or hauling travel trailers for now. My main point is there will be certain segments in our society where EV will never be feasible in the near future, with existing technology.

CHIEF

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13 minutes ago, 52-80 said:

Its not a mutually exclusive proposition. More people buying electric cars doesn’t make existing gas stations disappear or an existing Kubota stop functioning. 

Less demand for gasoline should also make it cheaper

Wrong on a few fronts. Oil and gasoline are largely global commodities so it doesn’t matter what some “sensible” fuckhead in Austin does to reduce American gasoline demand. And gasoline demand is only going to continue to increase globally. So, wrong. 

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11 minutes ago, Porterhouse said:

Wrong on a few fronts. Oil and gasoline are largely global commodities so it doesn’t matter what some “sensible” fuckhead in Austin does to reduce American gasoline demand. And gasoline demand is only going to continue to increase globally. So, wrong. 

Uh is there an implicit reciprocity where if an Austinite switches to electric, another Globalite destroys their existing electric and switch to gasoline?

1 unit less of gasoline demand is still, 1 unit less, *net*. 

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20 minutes ago, 52-80 said:

Uh is there an implicit reciprocity where if an Austinite switches to electric, another Globalite destroys their existing electric and switch to gasoline?

1 unit less of gasoline demand is still, 1 unit less, *net*. 

But it won’t be less demand - that’s my point. Look at India and China. They’re not buying EVs, particularly India. This has been the case for at least two decades. 

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38 minutes ago, Porterhouse said:

But it won’t be less demand - that’s my point. Look at India and China. They’re not buying EVs, particularly India. This has been the case for at least two decades. 

China's EV sales are gangbusters YoY and outpacing total car sales.  Their EV% share is higher than US.  EV growth pattern is similar in India, total global trend is up.

Regardless, whatever the status quo is, each new car is incrementally more demand for petrol, the same, or less.

If the world doubles its demand, the basis of comparison is  [the world AND 40 more Mustang V8s in Austin], vs [the world AND 40 more Mustang MachEs] in Austin.

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1 minute ago, 52-80 said:

China's EV sales are gangbusters YoY and outpacing total car sales.  Their EV% share is higher than US.  EV growth pattern is similar in India, total global trend is up.

Regardless, whatever the status quo is, each new car is incrementally more demand for petrol, the same, or less.

If the world doubles its demand, the basis of comparison is  [the world AND 40 more Mustang V8s in Austin], vs [the world AND 40 more Mustang MachEs] in Austin.

Your top paragraph is just wrong. EVs will grow everywhere. They may even grow as a percentage disproportionately to the West. It won’t matter with 1 billion Chinese and 1 billion Indians poised to drive and in the market for a car for the first time in their lives. 

Your bottom paragraph makes zero sense. 

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6 minutes ago, Porterhouse said:

Your top paragraph is just wrong. EVs will grow everywhere. They may even grow as a percentage disproportionately to the West. It won’t matter with 1 billion Chinese and 1 billion Indians poised to drive and in the market for a car for the first time in their lives. 

Your bottom paragraph makes zero sense. 

1. EV as % of total car sales is increasing annually in China, India, and globally.  That is a fact, not an opinion.

2. The world demand for a gasoline is "X".  Each individual can either add or subtract to that demand.  If even 1 person chooses to travel by electricity instead of gasoline, it is 1-person-less of demand.  It ain't rocket surgery - just keeping basis of comparison the same.

 

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6 minutes ago, 52-80 said:

1. EV as % of total car sales is increasing annually in China, India, and globally.  That is a fact, not an opinion.

2. The world demand for a gasoline is "X".  Each individual can either add or subtract to that demand.  If even 1 person chooses to travel by electricity instead of gasoline, it is 1-person-less of demand.  It ain't rocket surgery - just keeping basis of comparison the same.

 

1. I know. I expect it will continue to increase. 

2. You’re so off base. Have you ever heard of the concept of having a decreasing percentage of an ever-increasing pie?  Gasoline demand for light duty transportation will only increase. This isn’t hard to understand. You’re operating in some fantasy land where there is a finite number of drivers on the globe. 

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2 minutes ago, Porterhouse said:

1. I know. I expect it will continue to increase. 

2. You’re so off base. Have you ever heard of the concept of having a decreasing percentage of an ever-increasing pie?  Gasoline demand for light duty transportation will only increase. This isn’t hard to understand. You’re operating in some fantasy land where there is a finite number of drivers on the globe. 

1. You said India and China are not buying EV.  The truth has been the opposite.

2. What does the price of tea in China have to do with a car buyer in Guthrie TX? 

For that individual, if they buy gasoline car, they are (incrementally) contributing to the demand of gasoline, and it will cost them (incrementally) more as a consequence. 

If they buy an electric car, they are (incrementally) decreasing the demand of gasoline, lowering its cost. 

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38 minutes ago, 52-80 said:

1. You said India and China are not buying EV.  The truth has been the opposite.

2. What does the price of tea in China have to do with a car buyer in Guthrie TX? 

For that individual, if they buy gasoline car, they are (incrementally) contributing to the demand of gasoline, and it will cost them (incrementally) more as a consequence. 

If they buy an electric car, they are (incrementally) decreasing the demand of gasoline, lowering its cost. 

1. Well if I did it was somewhat hyperbole but the point remains that they’ll buy more gas powered cars. Many many more. That’s my point. 

2. First, what occurs in China and India has EVERYTHING to go with the price of gasoline across the world as it is a global commodity. Not a regional commodity like natural gas. Second, of course I understand your illustration but you fail to understand my very basic point. Gasoline demand will continue to be strong because there will be more gas powered cars on the road. Irrespective of whatever % increase in EVs you may read about wherever. 

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ExxonMobil statement regarding President Biden Letter to Oil Industry

June 15, 2022 02:46 PM Eastern Daylight Time

IRVING, Texas--(BUSINESS WIRE)--ExxonMobil today released the following statement in response to a letter from President Biden.

We have been in regular contact with the administration to update the President and his staff on how ExxonMobil has been investing more than any other company to develop U.S. oil and gas supplies. This includes investments in the U.S. of more than $50 billion over the past five years, resulting in an almost 50% increase in our U.S. production of oil during this period.

Globally, we’ve invested double what we’ve earned over the past five years -- $118 billion on new oil and gas supplies compared to net income of $55 billion. This is a reflection of the company’s long-term growth strategy, and our commitment to continuously invest to meet society’s demand for our products.

Specific to refining capacity in the U.S., we’ve been investing through the downturn to increase refining capacity to process U.S. light crude by about 250,000 barrels per day – the equivalent of adding a new medium-sized refinery. We kept investing even during the pandemic, when we lost more than $20 billion and had to borrow more than $30 billion to maintain investment to increase capacity to be ready for post-pandemic demand.

In the short term, the U.S. government could enact measures often used in emergencies following hurricanes or other supply disruptions -- such as waivers of Jones Act provisions and some fuel specifications to increase supplies. Longer term, government can promote investment through clear and consistent policy that supports U.S. resource development, such as regular and predictable lease sales, as well as streamlined regulatory approval and support for infrastructure such as pipelines.

About ExxonMobil

ExxonMobil, one of the largest publicly traded international energy and petrochemical companies, creates solutions that improve quality of life and meet society’s evolving needs.

The corporation’s primary businesses - Upstream, Product Solutions and Low Carbon Solutions - provide products that enable modern life, including energy, chemicals, lubricants, and lower-emissions technologies. ExxonMobil holds an industry-leading portfolio of resources, and is one of the largest integrated fuels, lubricants and chemical companies in the world. To learn more, visit exxonmobil.com and the Energy Factor.

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Exxon Mobil's oil production since 2014 (three presidential administrations of both parties) is remarkably consistent.  They produce the same amount of oil ever years, regardless fo who is president.

It's like whoever is president really doesn't matter..... 

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12 minutes ago, Aqua Buddha said:

Exxon Mobil's oil production since 2014 (three presidential administrations of both parties) is remarkably consistent.  They produce the same amount of oil ever years, regardless fo who is president.

It's like whoever is president really doesn't matter..... 

I suspect it’s slightly increased YOY with few exceptions (2015 and 2020 would qualify). It’s like it doesn’t matter who the President is except with their dumb enough to assault you with an oil profits tax. 

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18 minutes ago, billfromlaketravis said:

Chevron’s letter has much stronger language. Enough so that Biden made a (I’m sure what he thought was witty)remark about it. 
 

Link: https://www.chevron.com/newsroom/2022/q2/a-letter-to-president-biden-from-chevron-ceo-mike-wirth

 

That’s the ticket JB. Populist politics over listening to experts. 

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On 6/15/2022 at 5:25 PM, CHIEF said:

What do you think the range would be on a F-350 EV pulling 24000 lbs. of a trailer full of cattle will be? 50 miles to the sale barn, and a return trip, reload, and make another run? Do you have to stop for 8 hours in the middle of the job to recharge? 

CHIEF

I asked the same thing in another thread and got told it was OK, the new 150 can haul 9k. So, it can haul the empty trailer into the field but those rounds going to have to sit.   I keep hearing about it being such a small market but I see a 3/4 or 1 ton for every three 1/2-tons where I am. The ratio might be less than that. And I’m in one of the largest cities in US.  

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An electric old school Ford ranger sized pickup would be just fine with me if I didn't have a wife and three kids that occasionally need to fit in it. I just need something that can haul whatever lumber and whatnot I need for whatever project I have going on, a few bags of deer corn and a feeder, etc.  Our land is only like half an hour from the house, so a 200 mile range wouldn't hurt me there. I completely understand the need for a diesel pickup that can haul your house from park to park, but a basic roundabout pickup for small stuff and to go back and forth to work would be awesome.

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Seems to me that there isn't a solution that will make most people happy.  There will not be sizable increases in fuel supply in the future and most likely will be decreases. 

The best option for consumers is to lower demand. And even if you're the only person lowering demand, your pocketbook realizes the benefits.

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1 hour ago, Nice Guy Eddie said:

Seems to me that there isn't a solution that will make most people happy.  There will not be sizable increases in fuel supply in the future and most likely will be decreases. 

The best option for consumers is to lower demand. And even if you're the only person lowering demand, your pocketbook realizes the benefits.

Demand destruction is largely a myth and certainly is at this point. 

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10 minutes ago, Porterhouse said:

Demand destruction is largely a myth and certainly is at this point. 

Not sure I agree or that it's opposed to my point. Consumers absolutely impact demand in the long run. And almost everyone can impact their personal demand for fuel. Someone that lives 50 miles from the work can still look for options to decrease their fuel usage.

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