Okay, I see where you are coming from now. I did note in my post that this could be the case if the demand were insatiable, by which I meant greater than total existing capacity. I did not think this was the case, but if the refining margin is that tight, then it may be. Since demand is only increasing, wouldn’t it be profitable for someone to build a new refinery?
Most likely, if they can jump through all the hoops required to build one.
There hasn't been a new refinery built in the US since 1976.
Our environmental laws have gotten completely out of hand. Following them is pretty much impossible. Even the existing refineries are almost always getting cited for something.
With not in my back yard attitudes, and the inevitable lawsuits that a company would have to overcome in order to build one, doing so becomes a very risky proposition because they could easily invest hundreds of millions if not billions of dollars and still not succeed in getting it built and operating.
Arizona Clean Fuels Yuma is trying to build a refinery in the Arizona desert. The price tag is estimated at $2.5 billion.
They are advertising it as the most advanced refinery, and therefore the least polluting in order to avoid some of the environmental backlash.
They have been trying to build it since 1999. According to their web page, they still haven't gotten all the permits they need in order to break ground. It will take them 3 to 4 years after they start building to get it up and running.
I wonder how many millions of dollars they have spent so far without even breaking ground.