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Oil companies look at permanent refinery cutbacks

Los Angeles Times -- Some of the nation's biggest oil companies are looking at permanently reducing how much gasoline and diesel fuel they make, a move that analysts say would almost certainly trigger higher prices for drivers.

"We know from internal documents from the last time we had a situation like this, in the 1990s, that there was an intentional strategy on the part of some companies to drive up profit margins by shuttering or closing refineries," said Tyson Slocum, director of Public Citizen's energy program.

Refiners say they're merely trying to improve profits so they can keep making gasoline.

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Submitted Mar 11, 2010 By: fordmexico

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kelsielee Champion Author Atlanta Posts:3,389 Points:667,550 Joined:Sep 2008	Message Posted: Mar 12, 2010 7:17:23 AM Ignore kelsielee Report Abuse It is hard to understand how the refineries are losing money. Demand for gas is down but gas prices are up. If the refineries are not causing the problem, then the blame must lie with the crude oil prices. Why do they stay so high when all the later steps in the process are unprofitable? Oh, that's right, speculators do whatever they can to keep prices high.
jbcol1 Champion Author Virginia Beach Posts:1,345 Points:213,605 Joined:Sep 2005	Message Posted: Mar 11, 2010 3:54:29 PM Ignore jbcol1 Report Abuse Sorry folks, but I am on my soapbox....... I don't know about all of you but, the more I read the news stories about gas prices and oil "futures", the madder I get. Come on America, it's time we put a stop to being used and abused. Let your legislators know that you are not going to stand for it anymore. Let them know that THEIR job is at stake. They put us in the position that OUR jobs are at stake... We CAN do the same to them. They work for us, remember??? Time we remind them of that. Darn it. I am MAD!!!!
Blackice Champion Author Twin Cities Posts:3,191 Points:806,490 Joined:Oct 2003	Message Posted: Mar 11, 2010 11:43:34 AM Ignore Blackice Report Abuse Rick52...it works both ways. fordmexico...sad but true. People and/or corporations want more money so to get more money they drive their prices up...meaning you need more money to buy things. Its the CIRCLE of GREED! [Edited by: Blackice at 3/11/2010 12:45:49 PM EST]
Rick52 Champion Author Milwaukee Posts:6,260 Points:280,105 Joined:Mar 2005	Message Posted: Mar 11, 2010 11:35:45 AM Ignore Rick52 Report Abuse bikechuck:Big oil has us for now but they will spur alternative energy sources and eventually we won't need them. I can only hope. Think !! Who has the money to buy up Alternative Energy ???? Big Oil.. You will be bowing to them once again!!!!! [Edited by: Rick52 at 3/11/2010 12:36:43 PM EST]
myambro Champion Author Sacramento Posts:1,139 Points:437,740 Joined:Mar 2005	Message Posted: Mar 11, 2010 11:30:21 AM Ignore myambro Report Abuse It's just business. It's nothing personal.
fordmexico Champion Author Michigan Posts:2,166 Points:181,650 Joined:Oct 2009	Message Posted: Mar 11, 2010 11:28:22 AM Ignore fordmexico Report Abuse Blackice posted in part, "The main problem we have here in America is over paid workers." Rick52 posted a reply, " Blackice You wages have to match the cost of living .... If you can lower the cost of living then the wages can be less ... Think !!!!!!!!!!!!" Blackice, There are many reasons jobs, especially in manufacturing are leaving the USA, I do not feel many people, including myself, think the cause is that we are being overpaid. Unequal trade practices, reckless speculation fueled by greed, constant engagement by the military in areas where there is dubious strategic value to us, increased competition in world markets and a lack of a coherent energy policy should be addressed before the wages of the working person.
bikechuck Champion Author Indianapolis Posts:2,041 Points:1,088,120 Joined:Apr 2006	Message Posted: Mar 11, 2010 11:27:48 AM Ignore bikechuck Report Abuse Big oil has us for now but they will spur alternative energy sources and eventually we won't need them. I can only hope.
Bud122CA Champion Author California Posts:2,980 Points:680,455 Joined:Jul 2008	Message Posted: Mar 11, 2010 11:27:24 AM Ignore Bud122CA Report Abuse This is a threat from the oil companies as they are threating to drive prices up. GREED!!!
Rick52 Champion Author Milwaukee Posts:6,260 Points:280,105 Joined:Mar 2005	Message Posted: Mar 11, 2010 11:26:53 AM Ignore Rick52 Report Abuse VWC:Do they have competitions or are they a monopoly? What do you think ????? Can you count the number of Big Oil Co. on two hands ??? There's your answer !!!!!! [Edited by: Rick52 at 3/11/2010 12:28:03 PM EST]
VWC Veteran Author Maryland Posts:378 Points:648,215 Joined:Oct 2004	Message Posted: Mar 11, 2010 11:24:01 AM Ignore VWC Report Abuse Do they have competitions or are they a monopoly?
nehemiah Champion Author Portland Posts:1,027 Points:136,495 Joined:Jul 2007	Message Posted: Mar 11, 2010 11:23:16 AM Ignore nehemiah Report Abuse just a couple of years ago, "they" were saying we don't have enough refining capacity and thus the high prices despite low crude prices - guess they are wrong?
JoeKR Champion Author New Jersey Posts:4,987 Points:1,111,940 Joined:Feb 2006	Message Posted: Mar 11, 2010 11:22:12 AM Ignore JoeKR Report Abuse Record profits year after year aren't enough?
chemist74 Champion Author Cleveland Posts:9,862 Points:1,688,535 Joined:Apr 2005	Message Posted: Mar 11, 2010 11:21:43 AM Ignore chemist74 Report Abuse The owners of the refineries can shut down the refineries any time they want since they do OWN them. Refineries generally will only be operated long term if they make a profit. Some refineries are more profitable than others. When the economy is bad and demand is down, some refineries may not be profitable and they will be temporarily shut down. If a refinery is expected to be unprofitable for a long time, it may be shut down permanently. Obviously, if enough refineries are closed, supply will be closer to demand and prices will probably go up. Almost all companies operate this way, not just oil companies.
Rick52 Champion Author Milwaukee Posts:6,260 Points:280,105 Joined:Mar 2005	Message Posted: Mar 11, 2010 11:20:46 AM Ignore Rick52 Report Abuse PhilMils :The best way for consumers to fight back is to use less of the oil products Like what that jug your milk comes in your shampoo container, your tooth brush,the plastic dash in your car,ETC.. ???? Please tell me more ways to use less Oil !!!!!!!!!!!!!!!!!
kst8er Sophomore Author St. Louis Posts:132 Points:192,375 Joined:Feb 2006	Message Posted: Mar 11, 2010 11:19:26 AM Ignore kst8er Report Abuse it's all about how much is in the big guys pocket
threewheeler Champion Author Seattle Posts:2,313 Points:286,620 Joined:Jun 2008	Message Posted: Mar 11, 2010 11:16:17 AM Ignore threewheeler Report Abuse Conserve
Rick52 Champion Author Milwaukee Posts:6,260 Points:280,105 Joined:Mar 2005	Message Posted: Mar 11, 2010 11:15:57 AM Ignore Rick52 Report Abuse Blackice You wages have to match the cost of living .... If you can lower the cost of living then the wages can be less ... Think !!!!!!!!!!!!
PhilMils Champion Author Virginia Posts:2,141 Points:453,750 Joined:Dec 2008	Message Posted: Mar 11, 2010 11:14:09 AM Ignore PhilMils Report Abuse The best way for consumers to fight back is to use less of the oil products. Better fuel economy is one way. A better way is to encourage research into alternative means of providing power. The sooner we get off oil, the better for the consumer.
Wesk8 Champion Author Michigan Posts:1,467 Points:638,415 Joined:Aug 2005	Message Posted: Mar 11, 2010 11:14:03 AM Ignore Wesk8 Report Abuse LMAO!! You guys are SOOOO funny!! First you clamber for less government. Then some gross abuse by corporations occurs such as this. Then the clamber is for greater regulation (i.e MORE government!) What are you going to do when the elected officials that are bought and paid for by these abusive corporations (and I think you know who they are) try to convince you that regulation will increase your taxes? Or force you into an electric golf cart? Or put your grandma in front of a Death Panel? These politicians care WAY more about your vote than they do about your persuit of happyness. They will tell you ANYTHING to scare you into voting for them. Think about it.
Rick52 Champion Author Milwaukee Posts:6,260 Points:280,105 Joined:Mar 2005	Message Posted: Mar 11, 2010 11:12:56 AM Ignore Rick52 Report Abuse Refiners say they're merely trying to improve profits PROFITS : The drive behind all this... I'm not denying them profit ...Just denying them RAPING(GOUGING) me unnecessarely ... That's what they seem to like to do ...
RAC110 Champion Author Massachusetts Posts:2,363 Points:1,165,235 Joined:Mar 2003	Message Posted: Mar 11, 2010 11:11:14 AM Ignore RAC110 Report Abuse just making billions and trillions in profits is not enough they say and management having salary and bonus in the multi-millions and they want more just goes to show how much greed they have
eddmac Champion Author Washington Posts:4,530 Points:998,105 Joined:May 2006	Message Posted: Mar 11, 2010 11:09:45 AM Ignore eddmac Report Abuse Big oil knows how much oil resources are left, they have to strech it out as long and as high as posible without inciting riots.
impala2008 All-Star Author Ontario Posts:594 Points:214,030 Joined:Sep 2009	Message Posted: Mar 11, 2010 11:05:12 AM Ignore impala2008 Report Abuse Any excuse to raise prices
Blackice Champion Author Twin Cities Posts:3,191 Points:806,490 Joined:Oct 2003	Message Posted: Mar 11, 2010 11:03:36 AM Ignore Blackice Report Abuse The main problem we have here in America is over paid workers. That's why jobs are sent out of this country. Pay someone $5 an hour oversea or pay someone $24 here to do the same job. It's GREED on everyone's part and it starts at the top.
CLM06 Champion Author Tampa Posts:4,704 Points:1,116,215 Joined:Sep 2006	Message Posted: Mar 11, 2010 11:02:39 AM Ignore CLM06 Report Abuse If we are not using gas why over produce but If the refineries are cutting back it also means it is not costing the refineries as much to operate
klatu2u All-Star Author New Jersey Posts:831 Points:197,475 Joined:Jun 2009	Message Posted: Mar 11, 2010 11:02:12 AM Ignore klatu2u Report Abuse Refinery capacity has been the bottleneck all along
VTROCK Champion Author Detroit Posts:1,987 Points:426,780 Joined:Sep 2008	Message Posted: Mar 11, 2010 11:02:10 AM Ignore VTROCK Report Abuse Refiners are going to have to get paid a bit more or we are going to have fuel shortages. It doesn't matter if you are able to run at full capacity when you aren't paid enough to make a profit.
uglytom Champion Author Florida Posts:3,121 Points:683,115 Joined:Jul 2007	Message Posted: Mar 11, 2010 11:00:17 AM Ignore uglytom Report Abuse Government[federal and local] should declare the refineries to be Absolute necessities and require their continued operation. Should a refinery be shut, excess profit taxes should be imposed. I do not believe government should be in every business the business of everyone,however, the robber barons weren't harnessed until government stepped in with anti-trust laws. The oil companies and the speculators must be strictly monitored as well! We have highway robbery now, fueled by the Arabs whim!
LeftLane1 Champion Author Georgia Posts:5,368 Points:894,325 Joined:May 2007	Message Posted: Mar 11, 2010 10:59:30 AM Ignore LeftLane1 Report Abuse Dont worry, When they do this then Obama will take them over too. Plus, When they do this We will all HATE Them too.
MiniFan Champion Author California Posts:1,828 Points:589,125 Joined:Nov 2008	Message Posted: Mar 11, 2010 10:58:27 AM Ignore MiniFan Report Abuse more gas increase to come?
pricechecker08 Champion Author Ohio Posts:4,087 Points:834,215 Joined:Jan 2008	Message Posted: Mar 11, 2010 10:58:26 AM Ignore pricechecker08 Report Abuse Just last year they said we did not have enough refineries to produce the gas we need. It is all about greed.Where is the Goverment we pay to control these things.
Gassed01 Champion Author Toronto Posts:1,751 Points:851,600 Joined:Jan 2006	Message Posted: Mar 11, 2010 10:56:28 AM Ignore Gassed01 Report Abuse Shouldn't be permanant. Guess what, then there will be a shortage in the future and they'll max out refinery production - then watch prices skyrocket. It is a plot to boost prices in the future. Bet on it!
FBI2991 Champion Author Michigan Posts:1,572 Points:415,630 Joined:Nov 2008	Message Posted: Mar 11, 2010 10:53:26 AM Ignore FBI2991 Report Abuse GREEEEEEEEED!!!!!!!!!
mreiff Champion Author Louisville Posts:1,623 Points:365,120 Joined:May 2009	Message Posted: Mar 11, 2010 10:52:11 AM Ignore mreiff Report Abuse Oil refining is but the next US industry to be outsourced.
MikLamb Champion Author Texas Posts:3,068 Points:1,203,140 Joined:Jun 2006	Message Posted: Mar 11, 2010 10:51:19 AM Ignore MikLamb Report Abuse Permanently reducing supply to drive up prices. Sounds like normal operating procedure for greedy oil companies to me.
JMJarvis1952 Champion Author Houston Posts:1,505 Points:391,780 Joined:Jan 2008	Message Posted: Mar 11, 2010 10:51:16 AM Ignore JMJarvis1952 Report Abuse And we wonder why they haven't built any new refineries in the US. Where's the competition.
baitmn Champion Author New Orleans Posts:4,018 Points:1,130,975 Joined:Sep 2006	Message Posted: Mar 11, 2010 10:50:17 AM Ignore baitmn Report Abuse why the can't steal anymore from us directly, trying for a new way, cutting in our pocket payroll
falcon69AB All-Star Author Calgary Posts:821 Points:230,640 Joined:Jul 2009	Message Posted: Mar 11, 2010 10:46:54 AM Ignore falcon69AB Report Abuse I only have one question...... Were we not being told not that long ago that there were not ENOUGH refineries and that was why prices were so high? Yes I do know demand has gone down but it has not decreased because of conservation alone, demand has also dropped because of high unemployment and once that turns around so will the demand. Just wait to see what we will be paying if they close refineries now. I would love to be able to print my own money like these oil companies are able to. [Edited by: falcon69AB at 3/11/2010 11:47:23 AM EST]
ricker8 Champion Author Ontario Posts:2,332 Points:474,535 Joined:Oct 2008	Message Posted: Mar 11, 2010 10:46:46 AM Ignore ricker8 Report Abuse create shortages , the same way they did in the early 70's and again in the mid 80's- just to inflate prices!
pnd1 Champion Author Tallahassee Posts:1,880 Points:374,755 Joined:Jul 2009	Message Posted: Mar 11, 2010 10:45:12 AM Ignore pnd1 Report Abuse So they are admitting that they are manipulating supply and demand.
paoli8 Champion Author Philadelphia Posts:2,982 Points:931,685 Joined:Jul 2007	Message Posted: Mar 11, 2010 10:43:38 AM Ignore paoli8 Report Abuse This is the way to increase profits and create shortages.
sg413 Champion Author California Posts:2,029 Points:449,010 Joined:Apr 2008	Message Posted: Mar 11, 2010 10:42:45 AM Ignore sg413 Report Abuse Well that's just great.
BartBuzz Champion Author Atlanta Posts:3,938 Points:810,010 Joined:Aug 2006	Message Posted: Mar 11, 2010 10:42:39 AM Ignore BartBuzz Report Abuse So much for the recovery. Keep conserving.
MG_Sputnik Champion Author Philadelphia Posts:3,238 Points:1,031,755 Joined:Apr 2006	Message Posted: Mar 11, 2010 10:41:42 AM Ignore MG_Sputnik Report Abuse They want to improve profits to keep making gasoline? BS! They want to improve profits so they can make more profits from us.
arnerator Champion Author Seattle Posts:3,247 Points:656,910 Joined:Sep 2008	Message Posted: Mar 11, 2010 10:41:35 AM Ignore arnerator Report Abuse Yes, they certainly are trying to improve profits....read that as MANIPULATE prices.
egd Champion Author Twin Cities Posts:4,065 Points:1,334,710 Joined:Mar 2005	Message Posted: Mar 11, 2010 10:40:13 AM Ignore egd Report Abuse okay lets move to alternatives, now
Jeff1944 All-Star Author South Dakota Posts:845 Points:214,830 Joined:Jan 2010	Message Posted: Mar 11, 2010 10:39:35 AM Ignore Jeff1944 Report Abuse In turn, we shall drive less.
grandmacbc Champion Author Buffalo Posts:1,744 Points:535,155 Joined:Oct 2008	Message Posted: Mar 11, 2010 10:38:46 AM Ignore grandmacbc Report Abuse We need those conversion kits for the gasoline vehicles on the road for alternative fuels!!!! Maybe they will wake up and see that forcing prices to rise is NOT always the answer.
NavyEOD Champion Author Los Angeles Posts:5,159 Points:1,062,540 Joined:Jul 2007	Message Posted: Mar 11, 2010 10:30:38 AM Ignore NavyEOD Report Abuse This is very bad news. We need alternative fuels.
CPapi Veteran Author Chicago Posts:349 Points:83,850 Joined:Nov 2009	Message Posted: Mar 11, 2010 10:30:28 AM Ignore CPapi Report Abuse "so they can keep making gasoline" and why are you closing refineries in the US?