Excerpt from portrait of Donald Trump speaking at CPAC in Washington D.C. on February 10, 2011. Image credit, Wikipedia, George Skidmore
Republican political strategy. bypassing the the failed 'birther' tactic, is likely to move to 'what you going to do about high gas prices?'. That, naturally, involves attacking EPA generally, resurgent "drill baby drill" chants, demanding eased permitting for petroleum refinery expansions, and so on. Such measures may boost oil company stock values. They will do nothing, however, to lower gas prices this summer. Here's why.Global economy fools; China rules.
Liquid petroleum-based fuels are internationally traded commodities. Price is driven by global supply and demand. Need data? Via the US Energy Information Administration:
Continuing strong world demand for distillate fuels is forecast to contribute to continuing high U.S. net exports of distillate fuel averaging 500,000 bbl/d this summer, down slightly from 520,000 bbl/d last summer. In contrast, the United States was a net importer of distillate fuel, averaging 120,000 bbl/d during the summers of 2000 through 2007.Moreover, refinery expansions require massive amounts of expensive stainless steel pipes, valves, and tanks. China controls the demand equation here, too.
Geographic distribution of stainless steel consumption (excerpted). USGS: Cr, Cu, Mn, Mo, Ni, and Steel Commodity Price Influences, Version 1.1
Refinery expansions and upgrades are complex for many reasons - permitting is only a subtopic - as well as time consuming, and capital intensive. Why would owners and stockholders want to expand US refineries in time for this summer's US demand spike when they can already export millions of barrels of liquid fuel per day - to the highest bidder? If anything, they'd add capacity closer to the fastest growing market: China.
Republican talking points are wrapped around psychedelic politics, and have little to do with global business reality. The un-hallucinated talking points won't prevail, unfortunately, until cable news goes for the facts.
Refineries can be "'tipped" to favor production of diesel - profitable to export to EU or to other markets - or, conversely, toward production of gasoline for US markets. Refineries are operated to make money for stockholders, not to keep prices down for US consumers. Not sure why it's so hard for TV news departments to figure this out.
See Brian's exemplary post just below: GOP Launches Push to Expand Offshore Drilling