CAMARILLO, Calif. —AP– [1] Gasoline prices have surged to a record nationwide average of $3.07 per gallon, nearly 20 cents higher than two weeks earlier, according to oil industry analyst Trilby Lundberg [2].
The previous record was $3.03 per gallon on Aug. 11, 2006.
But despite inventory fears that have sent prices higher, there are signs that the rising prices at the pump may be peaking.
So along comes Chuckles “The Clown” Schumer. Who does he blame for this? Why, the Oil companies, of course. [3]
With gas prices already skyrocketing to $3.14 per gallon across New York City and threatening to reach record highs this summer, U.S. Senator Charles Schumer Sunday said the nation’s oil refineries are operating below capacity, contributing to price spikes at New York gas pumps.
Recent unexpected operational and infrastructure problems at leading oil refineries, including an explosion at a major Oklahoma refinery last week, have disrupted the nation’s gasoline supply. Schumer is concerned the nation’s big oil companies have been reluctant to reinvest record profits into maintaining their refineries and increasing capacity, instead opting to keep capacity tight to justify price spikes when unexpected bad weather or outages occur.
The senator Sunday called for the Government Accountability Office to conduct a full investigation into why Big Oil companies have failed to increase total refinery capacity to keep pace with consumer demand. He is also seeking answers to whether this failure to invest in new infrastructure has contributed to the recent rash of refinery outages and rising prices at New York gas pumps.
“Despite record billion dollar profits, it seems the big oil companies are willing to turn a blind eye to their decrepit oil refineries and risk fires and explosions that could not only cripple the nation’s oil supply, but also stick New Yorkers with skyrocketing prices at the pumps,” said Schumer. “Instead of putting profits straight into their pockets, oil companies should be investing in their refineries so our nation’s gasoline supply stays high while prices at New York gas pumps stay low.”
Hey, Chuck? I know this kind of thing is a little beyond you, but try to pay attention: [4]
PHILADELPHIA, May 2 /PRNewswire-FirstCall/ — Sunoco, Inc. today reported net income of $175 million ($1.44 per share diluted) for the first quarter of 2007 versus $79 million ($0.59 per share diluted) for the first quarter of 2006. Excluding special items, income was $85 million ($0.70 per share diluted) for the current quarter. There were no special items in the first quarter of 2006.“While refining margins and operating income were improved versus last year’s comparable period, our results were significantly limited by the major turnaround and expansion work at our Philadelphia refinery,” said John G. Drosdick, Sunoco Chairman and Chief Executive Officer. “This $520 million project reduced first-quarter refinery production by approximately nine million barrels and also contributed to higher average crude oil costs and the sale of low-valued residual fuel inventory. The timing of this downtime and its associated impacts occurred during the part of the quarter when margins in the Northeast were at their highest levels. Also in the Northeast, a loss of steam from a power outage at a third-party supplier resulted in an unplanned shutdown of the Marcus Hook refinery in February that reduced throughput by an additional one million barrels.
“With the recent completion of the Philadelphia turnaround and fluid catalytic cracking unit expansion project,” continued Drosdick, “our Northeast refining system is now returning to normal operations as we enter the summer driving season. In addition to the expansion of the catalytic cracking unit’s capacity from 70 to 85 thousand barrels per day, we expect the project will provide us with the ability to upgrade an additional 15-20 thousand barrels per day of low-value residual fuel oil into higher-value gasoline and distillate products and demonstrate the increased earnings power of these assets.”
Now, nobody can predict a power outage. But consider the question of why it is they undertook such a project in the first quarter. Governmental regulations. All in the name of ‘the environment’, of course.
Added details [5] reveal the Texas City refinery was also mostly offline through the period. And yes, it’s because of a lack of refining capacity that we’re in this mess. But here ’tis:
Why would the capacity be that low? Because there’s no investment incentive in adding new capacity, given the regulatory state of affairs.
So, who’s holding YOU accountable for this mess you’ve led us into, Chuck? Instead of pointing the finger of blame at the Oil companies, how about reducing the regulations on them so we don’t have to go through this every year?