Bush endorses Saudi gasoline "price control" plan

[Lefty48197]

All of us have watched the price of gasoline climb from about $1.25 to about $2.50 in the last couple of years. At the same time, we've watched crude oil go from about $25 to about $55 per barrel.

President Bush's pollsters have explained to him that we are "concerned" with this issue, so he has decided to go on tv and talk about a whole bunch of crazy stuff, and hope that we don't quite hear what he has to say about oil and gasoline prices. I don't blame him.

Prior to his speech, Bush had the Saudi Minister of Disinformation, Mr. al-Fullah Shiite, explain to us that it was our lack of refinery space that is the cause of our high gas prices. I don't know the guy's real name, but I saw him make the comment on TV yesterday.
He said that even if oil prices were lower, then gas prices wouldn't come down because of our lack of refinery space.

Today, I hear that Bush has a plan to help lower the price of gasoline. Bush wants to build more refineries. He wants to build them on abandoned military bases, perhaps the ones whose closure is to be announced soon?

Here's what's confusing me: For years, the Republicans have been telling us that drilling in the ANWR is the answer to our oil and gasoline needs. At times, they think more crude oil is the answer to our problems. If politically expedient, they will push the drilling issue, or at other times, the refinery issue. Whichever suits the moment.
Unfortunately for the Republicans in Congress, who are pushing the ANWR drilling bill currently, Bush and Saudi Arabia are now saying that it is the limited refinery space that is causing the high prices.

Well, which is it? Maybe they should caucus?

Let's do a quick analysis:
Two years ago, gasoline was about $1.25 per gallon, in spite of our "limited refinery capacity".
Today, gas is up near $2.50 per gallon, using the same "limited refinery capacity". The only difference this time is that Saudi Arabia has raised the price of crude oil 125% in under two years.

Oil up 125%, gasoline up 100%.
That looks like a pretty close correlation. I don't think the ability to refine larger amounts of over-priced oil is the answer to the high gasoline prices. The answer is to get the price of oil back down. Quit battling with Venezuela's leaders. Be a true friend of Mexico and Russia, and don't just patronize them. Use our strategic oil reserve, strategically. Force Haliburton to charge our military market rates, instead of black-market rates for fuel. And tell Saudi Arabia that if they don't lower the price of oil, then we are going to stop giving huge tax cuts to Bush's rich friends, and instead use the money to give tax breaks to people who drive hybrids, or fully electric vehicles, or natural gas vehicles, or vehicles that get over 35 mpg. That'll scare the hell out of them.

[Timebound]

1. They can't keep their stories straight.

They're all so disgusting...

[TheFarseer]

2. These are false solutions

The price of gas has doubled under the bush administration and if you trust him to now fix the problem, you are a damned fool. Trusting the Saudis to lower the price of oil is like trusting the bank robbers to guard the bank. Insanity! Why in the hell would they want oil to be lower in price! It would be like me marching into my bosses office tomorrow and demanding a cut in pay.

[Coastie for Truth]

3. Some apolitical, well written reads

Here are some good, well written, "scientific American" level books worth reading.

1} Matthew Simmons, "Twilight in the Desert: The Coming Saudi Oil Shock and the World Economy"

2) Ken Deffeyes, "The View from Hubbert's Peak"

3) Ken Deffeyes, "Hubbert's Peak : The Impending World Oil Shortage"

4) Anthony Evans, "An Introduction to Economic Geology and Its Environmental Impact"

The real issue - we are going after oil

a)--- that is in more difficult places top get to (not in Titusville PA or Midland TX anymore, not even that much in Saudi Arabia any more ---> but in really bad places), and

b)--- that is "heavier" (more tars, less C4-C8 fraction; ---> therefore more expensive to refine) and

c)--- that is "sour" (more organo-sulfur and hydrogen sulfide ---> more of a threat to the environment and to shipping and refining --> therefore expensive pre-refining steps).

Add this to the fact that we have "optimized" the heck out of our refineries so that a modern refinery is really designed and built to take in crude over a very narrow range of properties (heavy/light, sweet/sour) and pump out a very narrow range of localized gasoline blends and concomitant chemical feed stock by-product. This looked like a good thing 30 plus years ago.

Its a lethal mix of "bean counter-itis" (over optimization) and "peak oil" (heavier, more sour crude in nastier places) and ever more SUVs and hummers and ever more remote suburban living and working.

There you have it.

We did it to ourselves, Big Oil did it to us, The Big Three did it to us, the Saudis and OPEC did it to us --> but bottom line ---> we did it to ourselves.

[rfkrfk]

4. perhaps more refineries would help areas that need goofy gas

just checked Bloomberg, commodity gas is USD 1.53 per gallon.


{for my area]
add 0.39 for tax
add 0.15 for pipeline, truck, gas station markup
,,,thats ends up pretty close to the price I pay.

other places have outrageous prices,
money taken directly from the poor,
that goes to the rich.

[Vogon_Glory]

5. What The Saudis Seem to Be Getting Out of Dubya

If Gee Dubya's new "energy proposal" is any clue, what the Saudis get out of any price reduction is yet more delay from the US in developing alternate energy sources to fuel our automobiles.

Promoting hybrids would have been a much better idea as a short-term measure than promoting diesels. A longer-term solution would have been promoting fuel cells that run on something other than hydrogen, both for automotive and stationary applications. Of course that would short the oil producers as well as up-and-coming neo-Enrons donating to the finances of the Republican Part.

[rfkrfk]

7. US, is not the whole world

is there some reason that the non-US world
can't do some of this stuff?

Please, Brits, Paks, Paragyuans, Sudanians,
take the lead with hybrids.

[Vogon_Glory]

8. Someone Else WILL Take The Lead With Hybrids

I suspect that whatever deals I suspect that Buckaroo Bush may or may not have made with the Saudis, someone else WILL take the lead with hybrid automobiles and probably with non-hydrogen fuel cell autos, too.

Right now, thanks to F*rd and Mr. Dropwrench's indolence, it looks like Toyota is ahead of the pack regarding hybrid passenger cars. I believe that Honda is also getting ready to move into hybrids in a big way.

I also remember reading that some Japanese outfit is experimenting with fuel cells using ammonia as a fuel source instead of hydrogen.

I suspect that thanks to Rulin' Dubya Posse and Banana Republican policies, if alternate fuels and sustainable energy technologies come to the US, they will be as licensed processes from foreign labs and foreign manufacturers.

[Kolesar]

6. We would need "new" refineries for thicker, sulfurous Saudi oil

That is my impression on it. Some other posters covered it here also. We don't import much Saudi crude oil. We import Venezuelan and other thinner crude oil with lower sulfur content.

[Coastie for Truth]

9. This was also discussed in the

thread that Hatrack started, and followed up on by Amanadabeech in post 4 (Expanding our ability to refine heavy, high sulfur oil) and me in Post 3 (Why The Government "Should" Build Refineries).

After some nasty comments about

PRIVATIZE PROFITS

SOCIALIZE RISKS

(which is what we do with casualty insurance, flood insurance, earthquake insurance, nuclear power plant insurance, etc.) the point is that based on Ken Deffeyes' discussion of the early stages of "Peak Oil" - we will increasingly rely on heavier crudes with higher sulfur contents, and on the tarry product of oil sands and oil shale. That stuff is neither easy not cheap to refine.

The margins are so low on gasoline from these heavy, sour sources that government construction of the refineries is probably the only way to buy a few more years. It's only going to get heavier and have more sulfur as we go to tar sands and oil shale.

My own political and economic and sociological bias (I am not "unbiased") is that I don't like "socializing" oil refining for a few mega business gazzilionaire friends of Bush. - Instead, I think we should be raising CAFE to Prius and Mini-Cooper and even electric vehicle levels, and moving people from personal transportation to mass transit, and from isolated, outer suburban cul-d'sacs to (regentrified) pedestrian friendly, transit friendly, high density urban neighborhoods, and moving jobs back to urban centers.

I mentioned Ken Deffeyes - here are his books:
1) Kenneth Deffeyes, "Beyond Oil: The View from Hubbert's Peak"
2) Kenneth Deffeyes, "Hubbert's Peak: The Impending World Oil Shortage"
Not a political polemicist - but a very knowledgeable petroleum geologist.

Also, one very readable book on all of these issues is Anthony Evans' "An Introduction to Economic Geology and Its Environmental Impact" - a very readable book on a subject that bored me to death in college.