Posted on 11/18/2014 9:59:34 AM PST by Laissez-faire capitalist
We most certainly need to "drill, baby, drill." But how much of this oil is going to be shipped elsewhere, and how much will stay in the US?
While much of it will probably be refined, will it then be shipped to Latin America or other places?
Why not keep it all (or at least the lion share of it) here in the United States?
Politics is the art of the possible, and the GOP needs to make that possibility a reality.
You're confusing some of your fellow posters!
Odd comment for someone who calls himself "Laissez-faire capitalist".
How about we let the owners of the oil sell it where they can make the best return on their best investment. It's not "our" oil.
We have a large jump in production of light, sweet oil in Texas. Many of the Gulf Coast refineries are already optimized for heavy, sour oil because it is cheaper than the light, sweet.
That area is reaching a near saturation point of light, sweet production. It is why our light, sweet oil imports have fallen far more dramatically than the cheaper heavy, sour.
The oil sand production is heavy, not light.
Because high domestic prices are good for the oil companies.
Higher cost to the refinery isn't. You think extra costs are not passed on to the consumer?
Oil is a fungible commodity.
I can buy a contract for crude from Saudi Arabia, but never take delivery because it is a long way around Africa.
So I can chose to have the Saudis ship to Malasia and get my actual crude from Libya, to be shipped to New Jersey for example; if I get low bids for that route.
The pipeline is just another pathway. It will reduce shipping costs a little, worldwide.
It is a commodity. It goes to the highest bidder. More oil on the market with easy access to ports is good for everyone. Especially non state sponsored terrorist oil.
Not our oil?
Tell that to millions of voters who still support drill, baby, drill and who wanted KXL built thinking that it would result in cheaper gasoline prices for them.
Sure, I believe in a return on investment, but that doesn’t mean that someone investing in this shouldn’t think about others beside themselves.
The founder of modern Laissez-faire Capitalism, Adam Smith, believed that making money was a good thing, but also believed that it shouldn’t be the sole or even primary purpose in one’s life.
Nope. GOP and GAO: Link
Your linked article's only reference to refined product is at the end, where it states that, since 2010, gasoline prices have become global. In other words, there is not an appreciable difference, adjusted for transportation costs. There is no incentive, or disincentive, to export gasoline.
This does not support your statement.
But if we can't export the light crude then what choice do they have but to export the Canadian crude?
You think extra costs are not passed on to the consumer?
And that concerns the refiners how?
Canada has relationships to maintain by exporting their oil to foreign countries. Probably less than 10% would go to U.S. consumption, but when you factor in U.S. oil ALSO being pumped through the pipeline, no one seems to know the exact % of oil from Canada which stays in U.S. How’s THAT for a murky answer?
Forgot to mention that there are probably tariffs and taxes the U.S. would charge Canada for transporting their oil. That’s some serious dollars right there, even if we didn’t actually get any of the oil.
It goes wherever Laissez-faire capitalism gets it the best price.
We currently import ~7 million barrels a day of oil.
The Keystone XL will carry 830 thousand barrels a day, mostly from Canada.
The refineries do not have to spend money to change the process to continue to use the heavy oil from Canada. They will just import less from Venezuela.
And that concerns the refiners how?
You honestly believe they don't try to reduce cost? The refinery business is a tight-margin industry.
We import 3 million barrels a day today from Canada. Much of that is on pipelines that also connect to Cushing, OK. Why are we not exporting that oil?
We are the largest, closest consumer.
How much of refined U.S. refinery production is exported? Thackney would be able to tell us. I would guess that the same proportion of refined Keystone product might be exported, likely 5%, not the 90% that you are speculating.
Why do you think we have the right to tell Canadians what to do and where to sell their oil? I am sure you are aware that it isnt just American crude going down this pipeline right?
Do you think it would be better for America, and GM and Apple, if we forbid the export of automobiles or computers?
In general, getting foreigners to give you money for things you produce is a good thing.
Smith also believed that, by rationally pursuing one's self-interest, economic well-being for all is maximized.
By directing that industry in such a manner as its produce may be of greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention.
We refine about 17.5 MMBPD of crude oil. The output is actually slightly more because the volume grows by a couple percentage points as the heavy molecules are split into light ones.
http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MOCGGUS2&f=M
Our Net Exports are up to 2.3 MMBPD of refined products. This 13% of our refinery runs.
http://www.eia.gov/dnav/pet/pet_move_neti_a_EPP0_IMN_mbblpd_m.htm
We actually export more, 3.0 MMBPD of refined products, but we import some as well to balance production verus consumption. For example, we make more diesel than we use, but make less gasoline than we use. So we export some diesel and import some gasoline.
http://www.eia.gov/dnav/pet/pet_move_exp_dc_NUS-Z00_mbblpd_m.htm
http://www.eia.gov/dnav/pet/pet_move_imp_dc_NUS-Z00_mbblpd_m.htm
A significant portion of our exports are also refinery “leftovers”. These are the bottom of the barrel after the lighter transportation fuels are removed. Petroleum Coke, residual fuel are some examples. They tend to be high in sulfur and metal content (compared to the lighter products). We don’t us much of that anymore in the US.
It amazes me that now that we have surplus refining capacity in the US, some seem to want to shut that extra down.
Nothing of value should ever leave the U.S.! We can all be rich that way. As a laissez-faire economist, I say there ought to be a law!!
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